How much should you save to retire at your current standard of living? To answer that question, many of us turn to a retirement work sheet or calculator.

But they both tend to overestimate what you're really going to need. You'll save more than you have to if you follow what they say.

No one can calculate, with pinpoint accuracy, how much will be needed. But there's no point accepting a target that's almost sure to be too high.

I've found two main ways that calculators overestimate:

* They might assume you won't receive certain forms of retirement income. You generally run into this problem when you buy a computerized retirement plan from a stockbroker, insurance agent or financial planner.

They might not count your future Social Security payments--because Social Security supposedly "won't be there" when you retire. They also might leave out your company's matching contribution to your 401(k) plan because, in theory, it could be withdrawn.

By leaving out these key sources of income, the salespeople can "prove" you need an enormous nest egg--perhaps $1 million or more. Of course, they'd be happy to invest it for you.

But both of these assumptions are unrealistic.

Let's say that the United States sees only mediocre growth over the next three decades. In that case, Social Security's trust fund could run out of money in 2034. But thanks to the continuing inflow of payroll taxes, 70 percent of all the promised benefits could be paid. It's sheer ignorance to say the system will "go bust."

Now let's assume that the economy grows as fast in the next 75 years as it did in the past 75 years. In that case, all promised benefits could be paid, according to projections by Social Security's trustees.

As for companies stopping their contributions to your 401(k)--they could, if they wanted a worker rebellion, congressional hearings and maybe a law requiring them to pay.

So assume your 401(k) will pay. If you leave the company and don't acquire a new 401(k), re-estimate your retirement needs.

* Retirement calculators usually overestimate how much you'll spend when you retire. They take a ballpark number--say, 80 percent of your current income--and project it (plus inflation) for the rest of your life.

But older retirees don't spend as much as younger retirees do. They don't have a mortgage anymore, don't travel, buy cars less often (or quit driving entirely) and buy few new clothes.

They spend more on medical care as they age, but not enough to offset the steady drop in the rest of their living costs.

Kenn Tacchino and Cynthia Saltzman, professors at Widener University in Chester, Pa., quantified this change, based on data from the Labor Department's 1995 Consumer Expenditure Survey.

They found that people 75 and older spent 26.5 percent less, on average, than people ages 65 to 74. A good rule of thumb is to assume that by 75, you'll spend 20 percent less in real terms (adjusted for inflation), Saltzman says.

Some older people spend less only because their incomes have dropped. But most appear to cut back voluntarily. Nearly half of all retirees are still adding to savings eight years after they leave their jobs.

Baby boomers will probably be no different. They have relatively higher housing expenses than their parents did. But otherwise they show no greater propensity to spend, the professors say.

If your spending will be lower than you thought, your savings can be lower, too. How much lower depends on the number of retirement years you're planning for.

Say you retire at 65 on 80 percent of your working income, and assume you'll live another 25 years. By 75, your expenses probably will have dropped to just 64 percent of your former income (before adjusting for inflation).

You'll probably have enough money if you provide for a retirement income equal to 70 percent of your working salary, instead of 80 percent, the professors say. You'll spend more in the early years and less in the later years.

Some financial planners argue that you should save as much as the calculators say, to allow for contingencies. But that means spending less money today. Do you want to cut your current spending to create a larger retirement nest egg that you might not need? Some of you would say yes; others, no.

Still, you have to save. It's nice to know that smaller savings will suffice. But you do have to meet this lower target or your standard of living will drop.