Why You Should Practice Retirement Before You Commit to It

Before you commit to a retirement date, spend 6 to 12 months living on the income retirement will pay you. Add your estimated Social Security benefit, any pension, and your planned annual portfolio withdrawal, subtract estimated taxes, and hold your spending to that monthly number while you are still working.

Keep earning and saving normally through the trial. The gap between what you make and what you let yourself spend goes to savings. The purpose of the trial is learning what retirement spending feels like while a wrong answer costs nothing.

What the Rehearsal Exposes

Your spending baseline. Most pre-retirees estimate retirement expenses at 70% to 80% of current spending. Often that is wrong. Healthcare before Medicare eligibility, front-loaded travel, and adult children who still need help all push it up. One widely cited industry estimate puts lifetime retirement healthcare costs at roughly $172,500 per person for someone retiring at 65 in 2025, about $345,000 for a couple, not counting long-term care.

Where your time goes. Retirement is a life transition with a financial side. Volunteer, take the class, spend a full Tuesday the way a Tuesday without work would go. Anyone who freezes partway through that experiment has learned how much structure work was providing.

Whether the date is right. Some people finish certain they are ready. Others want another year, because they have not worked out what comes next. Both are good outcomes. The one to avoid is finding out after leaving a career that is hard to re-enter.

Why This Beats Another Projection

A projection tells you whether the math works on paper. A rehearsal tells you whether it works in your life, and it retrains the habit. After 30 or 40 years of watching balances grow, watching them decline, even on schedule, is a well-documented source of anxiety. Some retirees respond by living far below what their plan supports, because nobody gave them practice at drawing down.

The window carries planning value of its own. Workers aged 50 and older can contribute up to $32,500 to a 401(k) in 2026, and the Setting Every Community Up for Retirement Enhancement (SECURE) 2.0 Act created a higher catch-up limit of $11,250 for ages 60 through 63, bringing the maximum annual contribution to $35,750.

The Takeaway

How variable your spending already is determines how much a rehearsal is worth to you. A household on a stable budget is mostly confirming what it knows. A household whose spending moves with bonuses, tuition years, or a business learns far more, because the figure they would have handed the plan was never real.

A rehearsal can also go wrong by being run too well. People treat it as a test to pass, cut hard for six months, prove the number works, then resume normal spending the week they retire. A budget you have to white-knuckle signals that either the date or the withdrawal assumption needs to move.

If you are within a few years of a date and want the rehearsal number built from your own plan, that is worth a conversation before you set it.

The information provided is for educational purposes only and does not constitute investment, legal, or tax advice. Consult with qualified professionals for guidance specific to your situation.