Enough use to be one dollar more than what I already had. Now it is knowning that if I go down the tubes in a financial crash then I will have most of America down there with me and it couldn’t be avoided.
The answer is different for everyone, but for me…it is knowing that my wife and I can spend $100,000 a year, adjusted for inflation, every year, until we both die.
What about inflation? Handled. I have 4 deferred indexed annuities, with income riders, that we can turn on, when needed.
What about sequence of returns risk? See annuities above and because our income is not predicated on taking withdrawals from our market invested portfolio, we can let it stay fully invested.
No debt…no mortgage…no real financial worries…that’s enough for me.
What’s enough? It’s different for everyone, but I have saddled myself with a high bar since my teen years, when I didn’t have any idea about what the stock market was. I was sure I’d never own any stocks, ever. I did know simple math and figured that if someday I could live on 10% of my total annual interest from my savings account, that’d be enough. Fast forward 50 years of hyper savings to today, and I’m feel’n that I now have enough, becasue I’m comfortably reliant upon stock index funds. A 2% draw upon a 3 year rolling average of our investments year-end value outpaces (customary 2%) inflation by 3x. I feel “relief”, not so much “enough”, and whatever is left over, goes to my wife and child, and then I hope to a good cause. In that order.
I will attempt to answer what “Enough” means to me in the financial wealth sense. First a little background:
When we bought our home after finishing my residency, I assumed we would stay for five years max then move to a more expensive neighborhood, where most other physicians lived. My initial assumption was that a more expensive home would be a “better investment”. Funny thing was, we liked the house, the neighbors, and our boys were happy. I asked my senior partner for his opinion, and he shrugged and said simply “Don’t buy a big house”. Around then I started reading Jack Bogle and Warren Buffett, and eventually many others too.
It became increasingly obvious to me, that the higher my present cost of living, the less available there is to invest for the future. Not to mention, the larger nest egg I would need to fund those higher costs in retirement. I realized my partner was advising against a more expensive lifestyle. It was necessary to make some financial tradeoffs.
My wife retired at 61. When I turned 64, I realized my nest egg had exceeded my “number”. I took Bill Bernstein’s advice and “quit playing the game”. I gave my partners a full year notice, reduced my hours, and enjoyed that last year. Then I joined my wife in retirement.
We still live in the same house. Our sons have grown up, and they along with their families live a short drive from us. We made tradeoffs between present and future consumption long ago which funded a lifestyle we greatly enjoyed, and still do, and for which we are grateful. “Enough” means we were happy with the lifestyle those tradeoffs allowed for while working, and which provided a nest egg sufficient to allow us to continue that same lifestyle now.
When Charlie Munger passed recently there was an article about why he lived in the same house for like 60 plus years and it had to do with his children and the lessons learned from not living extravagantly. I’ve always tried not to be house poor and now, in retirement, my house is paid for, however, it’s not a dream home that others have. It’s a nice spec house in a nice neighborhood and that’s it. But not being house poor gives me a huge amount of flexibility now in retirement. Sounds like you made a good choice.
I read Jonathan’s newsletter for this date–May 6, 2023–early this morning, after which he bid us answer this question. I’ve been thinking about it off and on all day. I don’t have a firm answer, but just last night, I was asking my wife about the multiple jars of mayonnaise, salsa and so on, including real food, in our pantry. She told me she just likes to be “well-stocked”. I knew this, already. I’m not sure we’ll ever get past the extra cases of paper goods in the bedroom corner. On paper, I guess I have enough to stop working. I keep working and saving, however, content to have more. We don’t really spend much, but maybe we’ll turn into spenders one day. Even if we don’t, it’s comforting to have extra dollars on the shelf, to be well-stocked.
Having enough is related to having choices on how we spend both our time and our treasure. For many laboring during their teens and 20’s, it can mean working in a job critical to covering their necessities of daily living, but not directly tied-in to long-term career aspirations. As we progress through the decades of working adulthood, the slow but steady accumulation of assets can allow for the option of not taking on jobs or responsibilities that may pay well, but otherwise conflict with our sense of self-worth, or interfere with the happiness of those in our family (typically because it reduces the amount of time spent with these same loved ones).
From time to time, someone will need install a new roof on our home, deliver a package (or pizza) to our doorstep, or perhaps review our company’s financial reports for inaccuracies. Having enough gives the me the option at some point to say “yes, that does need to be done – but not by me anymore”.
Alternately, having the option to redirect some of our recaptured time (and excess capital) in support of causes we find both worthy and enjoyable (donating money or volunteering to support a worthy charity, for example) – this is the greatest reward of having enough.
Indeed, having enough is about having the freedom of choice.
I think our definition of enough changes as we age. When I was a young man having “enough” was the amount of money necessary to experience life, like having enough money to see U2 in concert, to take a girl out on a nice date, to buy a house, to take the family on vacation, to pay for tuition, etc… Now that I am older, I spend much more time thinking about having enough, so that I don’t have to worry about money after I decide to retire from work.(12 months, but who’s counting 🙂
”But godliness with contentment is great gain. For we brought nothing into the world, and we can take nothing out of it. But if we have food and clothing, we will be content with that.”
Enough is the freedom to make purchase decisions without having to first review my checking account balance. Purchases made in my 20s typically had a $20-$30 cap (stress threshold) before I’d feel the need to look at my bank balances or review my monthly budget. In my 50s, a few more zeros have been added to this “better first take a peek” denomination, but the psychology behind this impulse still remains constant.
Enough is simply about having the personal freedom to choose without feeling financial stress in the moment, nor feeling any significant amount of post-purchase “buyers regret”.
My definition of “enough” is a recognition of having achieved the upper limit of a standard or goal. If one’s aim is to keep up with the Joneses, there will never be enough.
Enough is when you realize that, beyond your basic necessities (food, clothing, shelter), no amount of money or material possessions can ever be enough. Enough lies elsewhere.
I would write down all of your monthly expenditures including home/rent, utilities, food, automobile payments and auto insurance, home insurance if home is paid off, cable, credit cards, and prescription and copay costs. I have done a 4 year look back on these to come up with a yearly cost. I then would look at pension (if you get one), social security if you can include that, and any other resources like 401K or stock divends and such. So, if income after retirement is enough to pay the bills…I would say that would be a confidence builder. You should always look for ways to cut the bills out to keep your income ahead of inflation. Inflation is the bear to your retirement.
It sounds simplistic, but I define “enough” as never, ever worrying about paying the bills. Of course, there are two ways to accomplish that: by amassing more dollars, or by spending less!
Enough so that if there are a series of unfortunate events (health issue, market crash, unexpected baby(??), job loss), then you are still fine. The younger you are, the bigger the distribution of possible outcomes, so I think older folks can have more confidence their “enough” is enough.
But you should also consider social aspects and mental stimulation when thinking about “enough”. Do you have enough social connections and activities? Maybe too much? That’s a delicate balance, too!
I think you have enough when you are confident the goals you have set for yourself can be achieved. Needless to say that means lots of variables. If we are just talking enough “stuff” then I suspect most of us have surpassed enough.
I think the answer to this is a version of “I’ll know it when I see it”. As I’ve aged and accumulated, the desire for stuff has definitely decreased. So decreased desire is definitely one indication.
Knowing when you have enough saved for retirement is more of a challenge, simply because you can’t predict the future. To me, the answer to that comes with a probability attached. Right now, I’m probably 90% sure we have enough to retire comfortably. But that 10% still nags at me a bit.
Enough use to be one dollar more than what I already had. Now it is knowning that if I go down the tubes in a financial crash then I will have most of America down there with me and it couldn’t be avoided.
Enough?
The answer is different for everyone, but for me…it is knowing that my wife and I can spend $100,000 a year, adjusted for inflation, every year, until we both die.
What about inflation? Handled. I have 4 deferred indexed annuities, with income riders, that we can turn on, when needed.
What about sequence of returns risk? See annuities above and because our income is not predicated on taking withdrawals from our market invested portfolio, we can let it stay fully invested.
No debt…no mortgage…no real financial worries…that’s enough for me.
What’s enough? It’s different for everyone, but I have saddled myself with a high bar since my teen years, when I didn’t have any idea about what the stock market was. I was sure I’d never own any stocks, ever. I did know simple math and figured that if someday I could live on 10% of my total annual interest from my savings account, that’d be enough. Fast forward 50 years of hyper savings to today, and I’m feel’n that I now have enough, becasue I’m comfortably reliant upon stock index funds. A 2% draw upon a 3 year rolling average of our investments year-end value outpaces (customary 2%) inflation by 3x. I feel “relief”, not so much “enough”, and whatever is left over, goes to my wife and child, and then I hope to a good cause. In that order.
I will attempt to answer what “Enough” means to me in the financial wealth sense. First a little background:
When we bought our home after finishing my residency, I assumed we would stay for five years max then move to a more expensive neighborhood, where most other physicians lived. My initial assumption was that a more expensive home would be a “better investment”. Funny thing was, we liked the house, the neighbors, and our boys were happy. I asked my senior partner for his opinion, and he shrugged and said simply “Don’t buy a big house”. Around then I started reading Jack Bogle and Warren Buffett, and eventually many others too.
It became increasingly obvious to me, that the higher my present cost of living, the less available there is to invest for the future. Not to mention, the larger nest egg I would need to fund those higher costs in retirement. I realized my partner was advising against a more expensive lifestyle. It was necessary to make some financial tradeoffs.
My wife retired at 61. When I turned 64, I realized my nest egg had exceeded my “number”. I took Bill Bernstein’s advice and “quit playing the game”. I gave my partners a full year notice, reduced my hours, and enjoyed that last year. Then I joined my wife in retirement.
We still live in the same house. Our sons have grown up, and they along with their families live a short drive from us. We made tradeoffs between present and future consumption long ago which funded a lifestyle we greatly enjoyed, and still do, and for which we are grateful. “Enough” means we were happy with the lifestyle those tradeoffs allowed for while working, and which provided a nest egg sufficient to allow us to continue that same lifestyle now.
When Charlie Munger passed recently there was an article about why he lived in the same house for like 60 plus years and it had to do with his children and the lessons learned from not living extravagantly. I’ve always tried not to be house poor and now, in retirement, my house is paid for, however, it’s not a dream home that others have. It’s a nice spec house in a nice neighborhood and that’s it. But not being house poor gives me a huge amount of flexibility now in retirement. Sounds like you made a good choice.
I read Jonathan’s newsletter for this date–May 6, 2023–early this morning, after which he bid us answer this question. I’ve been thinking about it off and on all day. I don’t have a firm answer, but just last night, I was asking my wife about the multiple jars of mayonnaise, salsa and so on, including real food, in our pantry. She told me she just likes to be “well-stocked”. I knew this, already. I’m not sure we’ll ever get past the extra cases of paper goods in the bedroom corner. On paper, I guess I have enough to stop working. I keep working and saving, however, content to have more. We don’t really spend much, but maybe we’ll turn into spenders one day. Even if we don’t, it’s comforting to have extra dollars on the shelf, to be well-stocked.
We’ve produced 3 shows on retirement happiness and have distilled it down to Health, Wealth and Purpose. Please read this chapter and open the show links at the end https://targetdatesolutions.com/articles/Chapter-18_Happiness.pdf
Enough is not too little. ‘Enough’ is realizing that the opposite—an insatiable appetite for more—will push you to the point of regret.
Having enough is related to having choices on how we spend both our time and our treasure. For many laboring during their teens and 20’s, it can mean working in a job critical to covering their necessities of daily living, but not directly tied-in to long-term career aspirations. As we progress through the decades of working adulthood, the slow but steady accumulation of assets can allow for the option of not taking on jobs or responsibilities that may pay well, but otherwise conflict with our sense of self-worth, or interfere with the happiness of those in our family (typically because it reduces the amount of time spent with these same loved ones).
From time to time, someone will need install a new roof on our home, deliver a package (or pizza) to our doorstep, or perhaps review our company’s financial reports for inaccuracies. Having enough gives the me the option at some point to say “yes, that does need to be done – but not by me anymore”.
Alternately, having the option to redirect some of our recaptured time (and excess capital) in support of causes we find both worthy and enjoyable (donating money or volunteering to support a worthy charity, for example) – this is the greatest reward of having enough.
Indeed, having enough is about having the freedom of choice.
Adage: Money may not buy happiness but it will keep a world of hurt off your front porch.
I think our definition of enough changes as we age. When I was a young man having “enough” was the amount of money necessary to experience life, like having enough money to see U2 in concert, to take a girl out on a nice date, to buy a house, to take the family on vacation, to pay for tuition, etc… Now that I am older, I spend much more time thinking about having enough, so that I don’t have to worry about money after I decide to retire from work.(12 months, but who’s counting 🙂
”But godliness with contentment is great gain. For we brought nothing into the world, and we can take nothing out of it. But if we have food and clothing, we will be content with that.”
Enough is the freedom to make purchase decisions without having to first review my checking account balance. Purchases made in my 20s typically had a $20-$30 cap (stress threshold) before I’d feel the need to look at my bank balances or review my monthly budget. In my 50s, a few more zeros have been added to this “better first take a peek” denomination, but the psychology behind this impulse still remains constant.
Enough is simply about having the personal freedom to choose without feeling financial stress in the moment, nor feeling any significant amount of post-purchase “buyers regret”.
My definition of “enough” is a recognition of having achieved the upper limit of a standard or goal. If one’s aim is to keep up with the Joneses, there will never be enough.
Those of strong faith cease asking the question of what is enough.
Enough is when you realize that, beyond your basic necessities (food, clothing, shelter), no amount of money or material possessions can ever be enough. Enough lies elsewhere.
Actually, you individually will be the only one who can answer this question, we are all different and when you have enough you will know it.
I would write down all of your monthly expenditures including home/rent, utilities, food, automobile payments and auto insurance, home insurance if home is paid off, cable, credit cards, and prescription and copay costs. I have done a 4 year look back on these to come up with a yearly cost. I then would look at pension (if you get one), social security if you can include that, and any other resources like 401K or stock divends and such. So, if income after retirement is enough to pay the bills…I would say that would be a confidence builder. You should always look for ways to cut the bills out to keep your income ahead of inflation. Inflation is the bear to your retirement.
I like Jack Bogle’s book titled “Enough”.
It sounds simplistic, but I define “enough” as never, ever worrying about paying the bills. Of course, there are two ways to accomplish that: by amassing more dollars, or by spending less!
John D. Rockefeller was asked, how much is enough? “Just a little bit more” he replied.
I suppose one measure of having enough is when your sense of self-worth doesn’t require having more.
I really like this one! Thanks!
Enough so that if there are a series of unfortunate events (health issue, market crash, unexpected baby(??), job loss), then you are still fine. The younger you are, the bigger the distribution of possible outcomes, so I think older folks can have more confidence their “enough” is enough.
But you should also consider social aspects and mental stimulation when thinking about “enough”. Do you have enough social connections and activities? Maybe too much? That’s a delicate balance, too!
I think you have enough when you are confident the goals you have set for yourself can be achieved. Needless to say that means lots of variables. If we are just talking enough “stuff” then I suspect most of us have surpassed enough.
I think the answer to this is a version of “I’ll know it when I see it”. As I’ve aged and accumulated, the desire for stuff has definitely decreased. So decreased desire is definitely one indication.
Knowing when you have enough saved for retirement is more of a challenge, simply because you can’t predict the future. To me, the answer to that comes with a probability attached. Right now, I’m probably 90% sure we have enough to retire comfortably. But that 10% still nags at me a bit.