User:Whaleknives/Budget models of retirement spending

Inflation
The size of your retirement spending budget will typically increase each year because of price inflation. These price increases can be very irregular and in some years quite large. It is for this reason that inflation is considered the retiree’s worst enemy.

The majority of retirement planning approaches treat inflation as an independent, adjustable variable. In doing so, they separate real retirement spending into two components: nominal or current spending, and inflation adjustments. This article follows the same approach. Unless stated otherwise, the budgeting models discussed in this article deal with nominal or current spending, not adjusted for inflation. Inflation adjustments are covered in the article Inflation and retirement spending.

Income taxes
Many of the budget models here do not consider taxes on income (earned or unearned) as an independent budget item, but rather an outcome of the total spending for other budget categories. However, like property taxes for homeowners, some income taxes merit separate budget items. An example of this is income tax for a Roth IRA conversion.

Any complete estimate of retirement spending must eventually include all tax payments.