Some calculators look at your current income and then ask you questions about future spending patterns, such as, "Do you plan to be frugal during retirement, or will your spending be similar to what it is today?"
The answer to that question is not only hard to know years in advance of retirement, but it's also missing a key point: Regardless of whether you're more or less frugal during retirement, the amount of money you need will change. Once you're retired, you're no longer saving as much, so you don't need as much after-tax income to support the same lifestyle.
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Research from the American Economic Association and National Bureau of Economic Research has shown that the wealthy often consume less than half of their net income because of taxes and savings. For example, according to our calculations, a single person living in New York with a pretax income of $1 million a year can assume that just over $410,000 of that goes to taxes and about $300,000 goes to savings and investments.
That means the amount you're spending is just less than $300,000, making it a good estimate of what you'll want to spend per year in retirement. (This hypothetical scenario refers to retirement spending, not retirement income, and does not factor in any expected salary increases.)