Are you likely to need as much money at the start of your retirement as you’ll need, say, 10 or 15 years later?

This depends on your personal circumstances. Some considerations are the age you retire, your health, and your plans for retirement. It's also important to consider that inflation will impact the value of your income over time. This means even if you spend your income in the same way and on the same things throughout your retirement, you’ll need more money each year just to counter inflation.

There are highs and lows in the amount of money you'll spend in retirement. To understand this better, it's helpful to split retirement into three distinct phases. 

• The active phase – it's the early retirement phase when we tend to be physically and mentally capable of living a fairly active lifestyle. In fact, the phase may not be that much different than pre-retirement except that there may be more time to do things like travel and hobbies. For some, the active phase will include work. It may be part time work or consulting in the same field of their pre-retirement career or it may mean self-employment. Whatever the case, active retirement is really living the stereotypical retirement dream. For many retirees in this phase, they're busier than they were prior to retirement. How long this can last for will differ from person to person, but it could be 10-15 years, or more, in many cases.
• The transitional phase – the next phase of retirement is the transitional phase where the body is telling you to slow down a little. Often this happens between the ages of 70 and 84, life starts falling into patterns and the excitement of retirement becomes more stable. Part of the reason for these patterns is that energy levels are changing and patterns help minimise effort and thought without compromising on the enjoyment of life. The older you get, the more important it is to find routines and patterns that give you comfort and security.
• The passive phase – the last phase of retirement is the passive phase. In this phase, time and age play a role in slowing down activities and abilities. This could be mental, physical or financial. Often this stage requires some level of support from family, governments or agencies. Choices become much more limited.

The pattern of expenditure can change over time during retirement. Ignoring inflation, if long term care is required towards the end of retirement, then the pattern of expenditure is 'U' shaped with peaks at the beginning and end. If expensive care isn't required, then the likelihood is that the amount required to live on in retirement will decline over time (again, leaving aside the impact of inflation).

Please note, this content is general information only and should not be interpreted as recommendations or advice.