It works both ways - you can spend too little, or too much.
I am retired, and me and all my friends have substantial amounts of money. We can spend some to have a good time, but how much?
My own personal view is that you can’t go wrong if your total value of your financial assets increases every year.
One analysis I read said that $1 million in a retirement account at age 65 is equivalent to a pension of $40,000/year.
Can you live on $40K per year? If so, you’re fine, so long as you aren’t spending more than that.
Need $80K per year? Then you need $2 million.
A million sounds like a lot of money until you calculate how long it’s going to last.
if you take up smoking you’ll have more money per year of retirement. Never too late
Someone needs to tell the author that buying a second home is not spending as in pi$$ing it away on wine and trips. Second homes are usually vacation homes that have been known to increase in value sharply. A 100K waterfront home in Florida the 1980’s is worth in excess of 500K today. A 400% increase is a pretty good investment.
I’ve encouraged my parents to spend without regard for us, their adult children. They earned their money. They sacrificed their comfort for us in our childhood. I don’t expect them to sacrifice their comfort in retirement. The best thing they can do with their own money is, by assuring their own comfort and care, they are buying their children more days with them.
Here's something that I don't understand or can't get my head around. How did my retirement money become my kids' money? I raised my kids to be self-sufficient people. I didn't give them anything except knowledge and a hard work ethic. They are doing well all by themselves.
But, I get the feeling that some people think that I am a piggy bank for my kids and enjoying my retirement is robbing my kids and their future. Bah! As I told my parents, "I want nothing, I expect nothing. Enjoy every penny of your retirement." I intend to do the same. If my kids are expecting windfall from me then they will be sorely disappointed.
Read it. Awful lot of words to say, “Don’t spend more money than you have.”
The big mistake? Hmm, well one of them is reading anything by Market Watch, or listening to the ass clown Jim Cramer.
People are doing whatever they please with their money, how horrible!
Some of us built most of our wealth outside of retirement accounts, so we don’t have that taxing problem with withdrawals. Our plan is to take only the minimum distribution when required and the rest of our retirement accounts are for emergencies or eventual inheritance for kids, grandkids. Our net worth is about the same as when we retired, as we keep our money working and producing income. And yes, that allows nice vacations too.
What is with all these nannies worrying about people who have built some wealth? Better to worry about those who spend it from day one and never built anything.
In preference to “skiing,” well off people should consider their kids’ struggles paying “payroll taxes” - which go into the Social Security “Trust Fund” - and thence directly into the Social Security checks of retirees nationwide. Even at that, the cash flow of SS is now negative - and tapping that “Trust Fund” is illusory since it is “invested” in IOUs the government wrote to itself. So to redeem that “fund,” the government has to get the money from the general treasury. So Social Security is just a dirty Ponzi Scheme trick played on the kids.If you’re that well off, you can afford to give your Social Security checks to the kids. And set the example that they should do the same for your grandchildren, if possible.
My only advice is the one I gave someone today—fire their financial advisor and get their money out of accounts that charge fees.
Take the annual fee money and go to the casino. Then you can have some fun while you risk your money.
When we signed up with our financial advisor, he asked us if we wanted to leave a legacy to our kids. My wife and I simultaneously said, “No.”
BUT, rather than leaving them a large lump at the end, we have chosen to enjoy their company by planning family events and vacations. Last year, took the whole family to Costa Rica for 10 days. Everyone had a great time.
This year the guys are going on a guided hunting trip. Girls are going “shopping” at Jackson Hole.
Sounds like the writer’s parents have been “skiing”* with their money instead of leaving it for him and his siblings.
Our adult off spring have a different look at our savings:
“If all our bills are paid in full, when we leave this earth, that will be perfect estate planning.”
*“Skiing = spending our kids’ inheritance.”
Who wrote this crap?
CD interest rates.
Today you might make $10,000 if you put one million into CD’s at the current rate of around 1% (in a year).
If we had the rate of return we had in the mid 80’s you could make $100,000 off that same million.
Now that I’m older and have the mortgage paid off, and don’t borrow money, I’d like to see the rates go back up some.
I am not that far from that $1 million and figure with social security and if I get some 5% or more from my million dollars without touching the principle then I can retire and not worry about money unless I marry and divorce a few times or take up gambling and hookers.