How to Spend More and Get More ROL in Retirement
For many clients who spend their entire careers following a financial plan, saving and investing isn’t just a commitment, it’s a mindset. And it can be very challenging for the, to switch from a “saving” to a “spending” mindset once they do retire. It’s almost as if they can’t give themselves permission to enjoy their own money!
If that sounds like you or your spouse, here are three questions you can discuss with us to help you get a greater Return on Life from your retirement assets.
- Am I going to outlive my money?
Running out of money too soon is probably the number one concern among retirees who are living far below their means. No one wants to become a burden to their adult children or face a sudden health or housing crisis that breaks the bank.
While a financial planner can help you make more detailed projections, an easy first step is to start scaling back on unnecessary expenses as you enter retirement. Cancel subscriptions and memberships you aren’t using. Get your grown children off your mobile phone plan. Sell that second or third car you never use…
Now you can create a monthly budget.
Finally, compare your monthly expenses to your annual withdrawal rate and any income you’ll be earning from part-time work. For some added peace of mind, consider adding an emergency savings account to your retirement plan that includes enough cash to cover six months to a year of expenses. And if you don’t like how these numbers add up, talk to your adviser about what adjustments you can make.
- Will my plan stay on track during life transitions and volatility?
If we know that you want to move to a seaside apartment in 5 years, we can start adjusting various dials on your financial plan to support that goal, while also being mindful of the contributions you want to make to your granddaughter’s uni fees in 7 years. Even better, by planning for what we can see coming, we can build in some flexibility so that your plan is ready if a goal changes or a money emergency springs up.
Regarding market volatility, if you have a diversified portfolio as well as cash savings, your adviser should be able to help you rebalance as necessary to take advantage of new opportunities and cope with short-term disruptions.
- When should I start giving?
If a fiscally conservative lifestyle is keeping you comfortable and allowing you and your spouse to have a little fun, maybe you don’t need to spend any more than you already are.
Instead, think about shifting some of your giving goals away from your legacy plan. It might be more rewarding to see your generosity in action now if you help a family member get on their feet or contribute to a charity that’s important to you. You could even start your own family foundation and involve your heirs in building a lasting mission.
Ready to start getting the best life possible with the money you have? Make an appointment start our planning process and you’ll see a wider and more fulfilling range of possibilities for your retirement.