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Suzie and I are packing a travel bag right now. Later this morning, we’re off to the Fermanagh Lakelands, a two-hour drive from our holiday home. We’re staying for three nights in a fancy hotel that’s also the wedding venue for the daughter of a very close friend. We’ll be attending the festivities there. I’m looking forward to the wedding, except, of course, for the suit I’ll have to wear.
I’m particularly interested in seeing the bride in her wedding dress because, unusually enough, I purchased it for her. Certainly not the traditional way with a wedding dress, but the bridal budget was having a cash flow crisis at the time.
I was deep in the throes of sorting out my retirement finances when this not insignificant purchase happened, and I admit, very unusually for me, I dallied slightly before making the offer. But a realization hit me: I’m retiring soon. If this wasn’t the perfect opportunity to give myself permission to spend in retirement, when would be?
I reasoned this would be a perfect test of flexing my retirement spending, putting the generosity line on the spreadsheet into real-world practice. Thinking about this, I considered the other outcome that people might have chosen in the same situation. After years of carefully saving for retirement and being careful with their budgeting, it’s not a given that this spending muscle would be ready for its task, and the offer of bridal help may never have happened.
I’ve read and seen a few real examples of people never fully embracing this phase when they enter retirement, living a life far below their means. They let their spending muscle atrophy through fear of running out of funds in their later years, or from simply being unable to shed the psychological shackles of frugality ingrained through their working years.
How can people overcome this problem? Say, for example, you start a program at the gym, you trust the instructor to professionally craft a weights program to suit your goals. Similarly, you should trust your retirement advisor and financial plan when they tell you your spending is ready to lift the heavy weight of retirement spending.
Start small if you need to, just as you would in the gym. Go for a nice meal or a short vacation to slowly become accustomed to spending, but use that muscle to the best of your ability to enjoy your retirement. Just as physical exercise becomes easier with practice, so too will your ability to spend without fear in retirement become second nature.
On a similar note, I’ve never enjoyed public speaking, but unfortunately, I need to practice this art because I have to give a short speech at the wedding we’re soon to attend. My speech will praise the bride and compliment her beautiful dress. Although I purchased it, I have no idea what it looks like. That privilege was only given to the bridal party and my wife, Suzie, who, unfortunately for me, is really good at keeping secrets. My own little secret is I’m hopeful my suit will be forgotten when packing for the big day.
I wonder to myself… Have others paused and reconsidered over impactful spending decisions because of retirement spending fears?
I would venture that we’ve all had the worry of whether we might run out of money in retirement. When I retired at 66, this was a central concern in figuring out how to invest our retirement funds. I don’t know that I will ever stop worrying, but 11 years later, we have more than we started with and have not lacked for anything. Part of this may be attributable to how our moneys were invested, but perhaps the most important factor has to be that we aggressively saved while we worked and started retirement with a nest egg that was more than likely to last. We consider ourselves lucky as not everyone can do this. So, now that we are on the short end of life, do we feel free to spend more? Probably not, but we do spend more freely on travel and entertainment than we did when we were younger.
When i approached retirement I pondered what it would mean to make a shift from accumulation to decumulation. Like cleaning out one’s lifetime of collected detritus I found this to be freeing. It has been easier than discarding all of the mementos I accumulated in business and during my years of volunteering. Those physical things represented a significant aspect of my identity and 50+ years of accomplishments. However, I decided it was better to live in the “now” and let all of that go. Divestment continues. Yesterday we visited the storage locker in Illinois and discussed approaches to emptying it.
Hi Mark. I enjoyed your telling of the wedding dress for your daughter by another mother.
A little over 46 years ago my wife and I married. Money was really tight then and my wife had sewing skills so she made her own wedding dress.
Fast forward to about nine years ago when our daughter was getting married. The dress my wife made and wore at our wedding was repurposed by disassembly and professionally recreated into a new wedding dress for my daughter. I was happy to pay the seamstress for the wonderful new dress and the memories doing so has created for us. I expect you will cherish the memory of your generous act and maybe some future day the dress you funded will be given new life again. You may even be called upon for a second speech.
Mark, in your last question you mention “impactful spending decisions”. Were you thinking about spending that impacts one’s future retirement spending plan, or the impact of the spending on someone else? Or both? I believe that thinking about any meaningful amount of spending (and that amount is individual) is worthwhile. Enjoy the wedding.