Personal Finance

Retirement Is Expensive – Here's How Much You Really Need to Save for It

Ariel Skelley | DigitalVision | Getty Images

Retiring doesn't mean you will spend less money.

In fact, people often underestimate how much their ideal retirement will cost, according to author Dan Ariely, a professor of behavioral economics at Duke University.

Being tied to an office all day can make it harder to spend money, Ariely said. In retirement, the new hobbies and activities you pick up to fill your leisure time often come with a price.

"If you're in retirement, every day is like the weekend. Every day is expensive. You want to do things. Very few people just want to go fishing and walking in the woods," Ariely told CNBC.

The best-selling author conducted a study that found most people expected they would need to replace about 75% of their salary to fund their retirement.

Researchers then calculated how much the respondents would need based on their planned lifestyle. Ariely said the numbers were way off.

Watch this video to learn what percentage the same people actually would need and how to start saving more for retirement.

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