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Retiring with $500,000 may leave you with less than $1,300 per month to spend

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What your monthly budget will be if you retire with $500,000

Saving money is only part of the equation when it comes to planning your retirement.

You also need to figure out how much you plan to spend and how long you'll need your funding to last.

Traditional wisdom says you should plan to live off 4% of your nest egg per year after you retire, which would give your investments enough of a cushion to sustain a lengthy retirement.

But based on recent market trends, the new rule of thumb should be 3.3%, according to researchers at Morningstar.

Check out this video to learn what the new change would mean for people who retire with $500,000.

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