For most people, this is not what retirement will look like. Extra money won’t fall from the sky, so a household budget is more important than ever before. (istock/istock)

It’s not like we have anything against doing a household budget. Most of us just never get around to it.

We procrastinate for many reasons. It’s a hassle. It takes some time and patience.

According to a 2013 Gallup poll, two-thirds of Americans do not keep a budget. While that might work for you while you’re working, it’s an entirely different story when you retire.

Then you have to match what you spend to the income from your retirement accounts. If you don’t, it can result in big problems, such as overspending and running out of money.

“It’s important, more so than when you are working,” says Joe Heider, president of Cirrus Wealth Management in Cleveland. “If you overspend while you are working, you always have more income. Once you get into retirement, if you overspend, you will start dipping into your principal. It can create a downward spiral. You don’t have the earnings to make up for it.”

A budget eliminates stress in retirement, Heider says. “You will know if you have enough money. If you budget before you retire, you may look at it and realize you don’t have enough money, or maybe you should keep working. It is easier to plan for before you retire, rather than retire and go, ‘Oops, I should have done that.’ ”

“Plan your retirement picture five to 10 years in advance,” says Michael Miroballi, president of BMO Harris Financial Advisors in Chicago. “Knowing what that picture looks like lets you know the contingencies you want to save for.”

Start with three to six months of statements — bank statements and credit card statements — says Nina O’Neal, investment adviser at Archer Investment Management in Raleigh, N.C.

“Six months is better,” she says. “Go through the statements and figure out exactly what you have been spending on for the last three months. And are there one-offs? Do I get a haircut every quarter?

“Work from a spreadsheet. Be as specific as possible and look even at your car insurance. Is this the appropriate amount to spend on the cable bill? Is this what I am using? Go line by line. Is this important to me? If it’s yes, we have to make it work. If it’s no, take out things that don’t matter.

“We talk about controlling your controllables,” she says. “One of those controllables is what you spend. You can’t control the markets or tax changes. But you can control your spending.”

A key is understanding your current situation, Miroballi says. Begin to budget for what your retirement looks like.

“Early in retirement, you are typically pretty active. All the things you are saving for, you get those done early. Then you slow down. Older people have health issues, and in later years they become more prominent.”

Most people tend to believe they spend less in retirement. Often that’s not the case.

“If they are not careful, most people spend more,” Heider says. “When you retire, you don’t have to worry about saving in the 401(k), you save on commuting costs, and you save on uniforms or suits. But the reality is that most people, when they retire, want to do the things they have always dreamed of, whether it’s travel or a hobby. You have 24/7 to go to lunch and dinner. It is easy in retirement to overspend.”

“People underestimate how long they will be retired and how much it will cost,” says Joe Duran, chief executive of United Capital in Newport Beach, Calif. “Leisure tends to be expensive. It is one of the things they underestimate. You will play more golf, buy more golf clubs and have more lunches with friends.”

Often overlooked is what Duran calls off-balance-sheet costs, such as elderly parents getting sick or adult children moving back home.

“So many things change once you have a fixed income,” he says. “How much you are willing to support other people must change. Your level of generosity has to change.

“For example, imagine you have three daughters and you are working,” he says. “For 35 years, your daughters are coming to you. They want to send their children to private schools or want to visit. They call mom and dad. Now mom and dad are retired. They have no more income from anything other than investments. And the kids are still accustomed to asking for help. The parents are still accustomed to helping. But the pie is not growing. Everything the kids are getting is coming directly from their parents’ future lifestyle.”

When it’s clear from the budget that people need to cut back on expenses, difficult conversations with clients can follow, O’Neal says.

“Some people don’t listen,” she says. “We have to keep saying, ‘You’re going to run out of money.’ For the people conscious about finances, we figure out a way that we will fix this.”