A 'Comfortable' Retirement of 390,000 Yen a Month? There's No Time to Be Afraid of an Imaginary Average

Where did the '390,000 yen a month' figure come from?

When the topic of retirement comes up, people always get anxious. Will my pension be enough? How much savings do I need? Many people likely harbor such vague anxieties. I understand that feeling well.

However, there is reason to suspect that the figures presented on television talk shows are designed to further fuel that anxiety. The one that says, 'You need 390,000 yen a month for a comfortable retirement.' Every time a commentator says this with a solemn face, viewers feel a vague sense of unease. But when you think about it, this number is quite suspicious.

The source is a survey by the Life Insurance Culture Center. It is the average value of responses to the question, 'How much do you think you need to live a comfortable retirement?' In other words, this is not a figure based on what people actually living in retirement say they are spending. It is a collection of figures imagined by people who have not yet reached retirement, thinking, 'This much would probably be comfortable.' It is an average of imagination, not reality. Moreover, the word 'comfortable' causes the imagination to inflate. When asked about a 'comfortable state,' people tend to think of figures that are a bit of a stretch. The 390,000 yen figure is a product of that psychology.

Talk show commentators speak of it as if it were reality. Viewers internalize the anxiety without noticing the discrepancy. This is how the retirement anxiety business is built. If you fuel anxiety, insurance sells, investment products sell, and seminars become fully booked. '390,000 yen a month' is the figure placed at the entrance to that business. The true nature of this scheme should become clear by the time you finish reading this article.

Note that this article focuses on daily living expenses. Medical costs and home repair costs are important issues, but that is a separate matter.

How much do actual elderly people spend?

So, what is the reality? Looking at the Ministry of Internal Affairs and Communications' Family Income and Expenditure Survey, the reality is quite different. Consumption expenditure for elderly couple households aged 65 and over is around 250,000 to 260,000 yen per month, and for single-person households, it is around 140,000 to 160,000 yen. There is a tendency for this to decrease further after the age of 75. This is because people go out less, their appetites decrease, and they simply have fewer opportunities to spend money.

There is almost no such thing as an 'elderly person who continues to spend 390,000 yen every month.' At the very least, it is not the profile of an average elderly person.

So, what is a 'slightly comfortable' level based on reality? A good benchmark would be adding 50,000 yen to the average of 150,000 yen for a single person, making it 200,000 yen, or adding 50,000 yen to the 250,000 yen for a couple, making it 300,000 yen. With 200,000 yen a month as a single person, you can easily afford to eat out once a week, go out for drinks with friends once or twice a month, and take a few short trips a year. If you save 10,000 yen out of that 50,000 yen, you can even take a slightly luxurious trip every few years. The time spent planning a trip is the most enjoyable part. Such a life is perfectly sustainable on 200,000 yen a month.

However, even this 50,000 yen addition is just a rough guideline based on feeling. For those who are accustomed to saving, an addition of 30,000 yen might be enough. You should use a figure that suits your own lifestyle. There is no need to conform to the average of other people's imaginations.

Why the anxiety still doesn't disappear

A question arises here: 'So, can I be at ease if I secure 200,000 or 300,000 yen?' Unfortunately, it is not that simple.

Humans have a property called hedonic adaptation. Once you get used to a certain level of living, it becomes the norm, and your sense of satisfaction fades. A person who felt comfortable with 200,000 yen will eventually start thinking, 'I want a little more.' This is not a lack of willpower. It is how the human cognitive mechanism works.

Furthermore, there is the issue of relative deprivation. If you feel inferior compared to those around you, your anxiety will reignite regardless of the absolute level. Even if you are living well on 200,000 yen a month, if people around you are making a fuss about 'needing 30 million yen for retirement,' you will feel as if you are the only one being left behind.

These two psychological mechanisms show the fact that peace of mind is not determined by the amount of money. People who are anxious will be anxious even with 100 million yen, and those who are satisfied with 20 million yen will be satisfied. The idea that 'I can be at ease if I save more' has no goal in principle. Retirement anxiety is not a problem of future living expenses, but something born from a lack of trust in one's future self.

The true nature of the retirement anxiety business

What the retirement anxiety business is selling is 'peace of mind.' But peace of mind cannot be bought with money. That is precisely why they can continue to present limitless figures. The figure of 390,000 yen a month functions precisely because it is far from reality. It is set at a level where no one would look at their current living expenses and think, 'Oh, that's enough.' If you understand hedonic adaptation and relative deprivation, you can see that this is no coincidence.

To avoid misunderstanding, funds to enrich your life have meaning. Being able to travel, eating what you like, and being able to spend money on hobbies—these things do realistically improve the quality of life. However, the endless accumulation of funds to 'buy peace of mind' is a completely different story.

Retirement living expenses fall into a realistic figure when considered on a factual basis. If there is anxiety that cannot be filled no matter how much you save beyond that, it is not a money problem. Nevertheless, the reason they can continue to sell anxiety using the '390,000 yen a month' figure is that it strikes at the blind spot of human psychology: that there is no upper limit to peace of mind. That is the real reason why the 'comfortable retirement' on talk shows is suspicious.