The sweet spot in retirement for many people is 74 years old. It’s perfectly situated between the high-energy “go-go-go” years of early retirement and the more sedentary “go-slow” phase as the 80s approach.
For the top 20% of earners, spending at this age will be higher than the average retiree. This is largely in part due to their desire to maintain a high standard of living, which will naturally cost more money.
What an Upper-Class 74-Year-Old Spends per Month
Data from the Bureau of Labor Statistics and private wealth studies said that the average American retiree household spends roughly $4,400 to $5,400 per month.
For an affluent 74-year-old, monthly expenditures range from $8,500 to $11,500.
At almost double the spending, this figure might sound a bit surprising, after all, many in this demographic own their homes outright. But the reason this number is so high is because upper-class spending is driven by discretionary choices.
A huge portion of this is due to travel expenses. Though, the nature of traveling changes depending on age. Instead of more affordable traveling, like backpacking across Europe, 74-year-olds are much more interested in luxury cruises, multi-generational family trips, exclusive locations, slow and immersive experiences and comfort-first amenities. All things that cost quite a bit of money.
Beyond travel, medical costs can increase expenses significantly, especially if a person is accustomed to high-end care. While Medicare covers the basics, wealthy retirees often opt for concierge medicine, premium Medigap plans and high-end wellness memberships that can easily cost $1,000 to $2,000 per month.
Where the Money Goes
To understand why upper-class retirees spend more money than the average person, we must look at the specific allocations. A lot of the time, it’s because they tend to spend significantly more on services that buy back their time, such as landscaping, house cleaning, private chefs and high-end grocery delivery.
| Expense Category | Estimate | What It’s Spent On |
| Housing | $3,200 | While many own their houses, homeowners still need to pay for things like property taxes, HOA fees, renovations and security. |
| Healthcare | $1,400 | Many pay Part B/D premiums, IRMAA surcharges and concierge care. |
| Food | $1,200 | Upper-class retirees are more likely to go to restaurants and shop for organic groceries. |
| Travel & Leisure | $1,800 | Higher incomes usually equate to high-comfort travel, club memberships and expensive hobbies (like boating or golf). |
| Transportation | $800 | While not applicable to everyone, many have luxury vehicle leases, insurance for those expensive vehicles and occasionally get private car services. |
| Gifts & Charity | $1,100 | Every grandparent loves to support their grandchildren’s education. Some are strongly motivated to give back and donate regularly to charity. |
| Total Monthly Spend | $9,500 |
RMD and Tax Strategy
Most retirees are legally required to take required minimum distributions (RMDs) from their traditional IRAs and 401(k) plans by their 70s. For the upper class, these distributions often exceed their actual lifestyle needs, creating a “forced spending” scenario.
And so, rather than letting this cash sit in low-interest accounts, accumulating next to nothing, they instead choose to reinvest these funds into brokerage accounts or use them for qualified charitable distributions (QCDs).
Final Take To GO
At nearly $10,000 per month, the lifestyle of the upper-class retiree ensures that the “go-slow” years remain as comfortable as the decades that preceded them.
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This article originally appeared on GOBankingRates.com: How Much the Average Upper-Class Retiree Spends Monthly at Age 74
