ChatGPT Reveals Retirement Spending at Age 85

An Aging Population Poses New Financial Questions

America's demographic landscape is shifting. By 2026, the oldest baby boomers will reach age 80, kicking off a period of significant growth for the nation's 80-plus population. Projections from The Wall Street Journal suggest that by 2030, there will be 4 million more Americans over 80 than there are today. This trend raises important questions about financial security in later life.

While this population boom may strain resources, retirees in higher income brackets, or those with a substantial nest egg, are better positioned for a comfortable retirement. But what does "comfortable" actually cost? To find out what an upper-middle-class octogenarian can expect to spend, GOBankingRates consulted ChatGPT for an estimate.

ChatGPT's Analysis of Retirement Spending Trends

Drawing on data from the Bureau of Labor Statistics' Consumer Expenditure Survey, ChatGPT identified a notable trend: retiree spending tends to drop by 20% to 25% after the age of 65. This is largely because expenses for things like entertainment and transportation decrease over time.

For those aged 85 and older, the majority of expenses shift toward essentials like housing, healthcare, and other basic needs. Based on the 2023 survey data, the average annual spending for all retirees over 75 is approximately $53,000.

What Does an Upper-Middle-Class Retirement Cost?

While the Bureau of Labor Statistics does not categorize its data by income, ChatGPT projected that upper-middle-class retirees likely spend between 20% and 50% more than the average. This places their estimated monthly expenditures in the range of $4,500 to $6,000.

The AI suggests this increase is primarily driven by higher costs in three key areas: healthcare, home maintenance, and caregiving services.

The Major Expenses for Retirees in Their 80s

The wide spending range can be partially explained by shifting housing costs. A 2023 report from Harvard’s Joint Center for Housing Studies revealed a dramatic increase in the number of older homeowners carrying mortgage debt. The percentage of homeowners aged 80 and over with an unpaid mortgage has surged from just 3% to 31%, meaning many still face significant housing payments.

Additionally, the cost of caregiving has become a major financial burden. According to the 2024 Genworth Cost of Care Survey, in-home care can cost nearly $78,000 per year, an expense that many can no longer afford without substantial savings.

The Bottom Line on Retirement Spending

Ultimately, ChatGPT estimates that individuals aiming for an upper-middle-class lifestyle in retirement should plan to spend well over $60,000 annually by the time they reach 85. This figure could easily rise due to inflation or unforeseen medical events.

The key takeaway is clear: even for those who have built a strong nest egg, living comfortably into one's 80s and beyond requires meticulous financial planning and the flexibility to adapt as personal needs and economic conditions change.