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Retiree Spending: $57,572 Average in 2025

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  Published in Stocks and Investing on Saturday, February 14th 2026 at 7:39 GMT by Investopedia
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The Big Picture: Average Spending in 2025

The $57,572 average isn't a monolithic number; it's a composite of diverse spending categories. Housing consistently emerges as the largest expense, clocking in at an average of $16,920 annually. This encompasses mortgage payments or rent, property taxes, homeowner's insurance, and crucially, maintenance and repair costs - often underestimated by pre-retirees. Transportation follows at $7,081, with food coming in at $6,727. Healthcare, a consistently growing concern, represents a substantial $8,254 portion of the annual budget. Beyond these necessities, retirees allocate funds to entertainment ($4,093), personal care ($3,778), travel ($3,200), and a catch-all 'miscellaneous' category totaling $6,505.

Homeownership vs. Renting: A Costly Distinction

The study highlights a significant financial difference between homeowners and renters. As expected, homeowners spend considerably more each year, averaging $65,997 compared to $47,520 for renters. This disparity isn't surprising, given the added costs of homeownership - property taxes, insurance, and the often-substantial expenses associated with maintaining a property. Unexpected repairs, such as a roof replacement or appliance failure, can quickly derail a retiree's budget. While renting offers predictability in monthly housing costs, it also lacks the potential for building equity.

Income's Impact on Lifestyle

Perhaps unsurprisingly, income plays a crucial role in shaping retirement spending. The LendingTree study clearly demonstrates this, breaking down expenses across three income brackets: $50,000 - $75,000, $75,000 - $100,000, and $100,000+. Retirees earning between $50,000 and $75,000 demonstrate a focus on essential spending. Their housing costs average $13,853, while transportation, food, and healthcare expenses are notably lower than those with higher incomes. Entertainment and travel budgets are also more restrained.

As income rises to $75,000 - $100,000, spending across all categories increases. Housing costs jump to $17,293, and retirees allocate more funds to leisure activities like entertainment and travel. However, the most significant shift occurs for those earning $100,000 or more. These retirees spend an average of $21,330 on housing, and their budgets allow for significantly more discretionary spending, including $4,429 on travel and $6,620 categorized as 'miscellaneous.' This demonstrates that while basic needs remain consistent, higher earners enjoy greater financial flexibility and the ability to pursue more enriching experiences in retirement.

The Growing Burden of Healthcare

The $8,254 average annual healthcare cost is a stark reminder of the financial challenges posed by aging. This figure includes Medicare premiums (which are predicted to continue to rise), co-pays for doctor's visits, prescription drug costs, and potentially, supplemental insurance premiums. Unexpected medical emergencies or chronic health conditions can quickly escalate these costs, potentially depleting savings. Proactive health management and long-term care planning are therefore crucial components of a secure retirement strategy.

Looking Ahead: Implications for Future Retirees

The LendingTree study serves as a valuable benchmark for individuals approaching retirement. It underscores the importance of creating a realistic budget that accounts for not only essential expenses but also discretionary spending that contributes to quality of life. Factors such as geographic location, lifestyle choices, and unexpected events can all impact these figures. Furthermore, it highlights the need to address healthcare costs proactively through careful planning and potentially, long-term care insurance. The data from 2025 suggests that a comfortable retirement requires a well-defined financial strategy and a clear understanding of the true cost of living during one's golden years. Finally, the study's reliance on a survey of 1,190 retirees reminds us that these are averages, and individual experiences may vary significantly.