Opinion: The moment I realized we’re saving too much for retirement

[Chuckanut]

Last year we flew to Egypt and this year we flew to Greece - first/business class both times. Those were the first two times in our lives we did that. It was well worth it.

I don’t fly first class. But, I do pay for upgraded superior rooms. I figure for every waking hour I spend on a plane I will probably spend at least 10 waking hours in my hotel,AirBnB, or other room. And I really enjoy the breakfast in a four star hotel.

 

[levindb]

Some people have a strong desire to leave a wad of cash to their children, and may avoid spending to maintain that legacy. I have a different view based on 2 experiences in my life:

1) My son's High School soccer coach used to eat popcorn and talk to the parents during soccer games. He said he teaches the boys how to play during practice including how to make decisions on the field during games.

2) We have an eagles nest in our neighborhood, and I was able to see how the eagle parents teach their young how to fly, and how to hunt. They prepare the young ones to live on their own.

I am very fortunate to have 3 healthy and successful sons who can support their families and help their own children become successful in the future. So DW and I are "planning" on spending all of our funds during our lives...but this plan assumes we will live to age 105. We understand that we may not make it that far, but if we do, we will be getting clean diapers every day. If we don't make it that far, then there may be some left over for the children.

We currently spend a lot on experiences, and clip coupons for groceries. Bill Perkins provides a good message for those that have choices on how to spend their funds...but his message is not for those living paycheck to paycheck.

At this stage of our lives, we only get 52 weeks of vacation each year...and if we do not use them, we lose them. Fortunately, each January, we get another 52 weeks of vacation. We prefer to do things rather than sit at home...and we are fortunate to have the funds to support that lifestyle. YMMV

 

[Ronstar]

...At this stage of our lives, we only get 52 weeks of vacation each year...and if we do not use them, we lose them......

Wow - well said!

 

[pacergal]

From the article: (bolded by me)

"I believe this is why, even including health care expenses, retired people spend less than working adults. When you stop to think seriously about what you’ll be doing when you retire — not just in the early years, but for the rest of your life — you’ll most likely see that you’ll need less money than you thought. If you tell a financial planner that your goal is to maximize your fulfillment, rather than maximizing the size of your nest egg, they can help you determine the right numbers for your individual circumstances.

Thinking about old age can be scary. You can have fear — or you can have a fulfilling life. The choice is yours."

I agree with this.
However, it seems many articles point out that the majority of Americans are not saving enough. But enough for whom? Decide what you want in life, and plan for it.

I can be happy putzing around at home, spending very little, a trip here and there.
I have spent time traveling, spending money like crazy, more than I ever did in the past.
Both are fulfilling, at the time, because that is my choice.

I am blessed to be able to have the life I do.

 

[TickTock]

That’s the big error people make in planning for retirement: They’re focusing on the money, without nearly enough thought to the activities that they will actually be doing.

This I can get behind.

You don’t retire on your money — you retire on your memories! It was then that I realized I’d better create some meaningful memories now, and I’ve been doing that ever since.

I assure you - you *do* retire on your money - as well as on your memories.

As I recall, the original article was titled "Everyone is saving too much for retirement". That is simply not true. So someone with enough (more than enough!) money pimps the experiences side, without understanding that most folks don't save enough for retirement.

 

[lucky penny]

This I can get behind.
I assure you - you *do* retire on your money - as well as on your memories.

As I recall, the original article was titled "Everyone is saving too much for retirement". That is simply not true. So someone with enough (more than enough!) money pimps the experiences side, without understanding that most folks don't save enough for retirement.

""
The article was titled: "Opinion: "The moment I realized we’re saving too much for retirement." Seemed to me the writer was speaking for himself & others who might be spending too much time focusing on maximizing the size of their nest egg when they clearly have more than "enough."

 

[TickTock]

I saw the article on CNN. It was titled as I wrote in the above post. Probably deliberately done as click-bait...

 

[Koolau]

I don't know if I would want to be Musk.

a) I would not be able to pronounce my own kid's name

b) Someone would need to keep me from opening my mouth on social media

Heh, heh, I'm not Musk but I have that problem here.

 

[Koolau]

Ok, I skimmed over it.

It is exactly what I thought it would be.

"But when people are planning the biggest, longest vacation of their lives — their retirement — most don’t do any of that. They’re thinking about how to save money, where to invest these savings, and how to minimize their tax burden, and yet they have only a vague sense of how they want to spend their free time or what their health will enable them to do as they age.

That’s the big error people make in planning for retirement: They’re focusing on the money, without nearly enough thought to the activities that they will actually be doing."


I could sum it up as "firecalc may show 100% but your knees are now only at 50%"

You nailed it!

 

[Koolau]

LOL. Yeah, we do revisit this topic quite a bit but I only just noticed that one aspect of the topic irritates me like work did. Jollystomper pointed out a quote: I read all those books about getting a life, planning your retirement out, know what you will do, and on and on. I always found it to be a king-sized PITA, just like the equivalent at work. Fifty years ago, I had to do my first analysis of "where do you see yourself in five years." "If you don't know where you are going, you won't know when you get there." Strategic plans out the yin yang. This stuff was endless. I hated it, and the irony is I was a champ at all that. Sure, we needed goals at work, but the personal stuff always felt like BS to me. None of it really panned out or helped me get anywhere. Life and work were much more random that any of that. Man plans, and God laughs.

When I retired, I breathed free. No more planning, just experiencing. I don't need no stinking lists. I don't need a roadmap. I don't want to find my passion. And I don't want responsibilities.

YMMV. You may be completely different. You may thrive on carefully thought-out plans. As for me, I travel, I ride, I read, and I constantly wander down rabbit holes of new interests that keep me endlessly entertained. Sooner or later, end of life issues will jam all that to a halt for all of us. Let's hope we go over a cliff and not tumble down a rocky slope. And thank God, I saved enough to get to the cliff in comfort.

Hear, hear! My philosophy in a nut shell.

 

[Koolau]

I remember planning our first trips to a T, accounting for this and that and overstudying and planning. When I heard about a thing that I missed at a destination it bothered me a bit. Then I got a little better and relaxed.
To heck with all that now.
Now my thinking is "The weather is good over that way for a few days, let's go".
" I really enjoyed https://www.butchartgardens.com/ I can enjoy them again, different time different blooms."

Thanks for sharing the web site. The gardens are beautiful.

Good way to plan, indeed. "Hey, the weather is good, let's go..."

 

[Music Lover]

I don't know if I would want to be Musk.

a) I would not be able to pronounce my own kid's name

b) Someone would need to keep me from opening my mouth on social media

I have nothing against Musk, and that didn't change when the media campaign told me to think otherwise.

 

[SunGuy]

https://www.fidelity.com/viewpoints/retirement/how-much-do-i-need-to-retire How much do I need to retire?

Fidelity's guideline: "Aim to save at least 1x your salary by 30, 3x by 40, 6x by 50, 8x by 60, and 10x by 67.
Factors that will impact your personal savings goal include the age you plan to retire and the lifestyle you hope to have in retirement.
If you're behind, don't fret. There are ways to catch up. The key is to take action."

Another fun fact, thanks to a very generous 7% match, and very strong participation, and a cool system in place to bump up your withholdings to at least 15% by 1% each year when you receive your annual review/raise, the average Fidelity Investments employee has roughly twice as much saved up than the market average cohort by their respective age group.

That link above is more of the standard response, the FIRE community is a step above or two or three compared to most people. We can't really talk to people like that.

When I tell friends that I have deeper discussions with about investing stuff to motivate us more, and how I try to save 35-50% of my take home pay each month they look at me like I am some kind of financial wizard. But it leads to many fruitful talks.

It would be hilarious if they would see my investment accounts and how I have grown my holdings including contributions/returns this year by 233% their heads would explode.

Peter Lynch famously held at one point over 1,500 stocks in the Magellan fund:
"...Lynch says he owned “at least 1,500” stocks in the Magellan fund. The fund was so huge, he was basically limited to playing industry bets..."

And I am well on my way in my Roth now at almost 150 holdings. But about 50 of those are "placeholder" tickers, with values under $5. Those are in the account to look for time/reaction based arbitrage opportunities.

Also, I do weekly screens on Fidelity and FinViz and Koyfin to look for new ideas.

It is an easy habit to build over time if you just START, like working out. Like the old saying goes, even walking you are running circles around the slobs sitting on the couch.

 

[SunGuy]

Let me pose you a question.

Who is happier today? Steve Jobs, Bruce Willis or the 66 year old guy who seems quite agile while loading in my packages at the UPS store?

First guy is dead. And was a terrible person. Not to be admired. Why I will never use anything Apple. Really hate how I have to have it in my various investment funds.

Second guy is now basically a mute I think with aphasia, maybe even early onset dementia, Alzheimer's? Whose career of overindulgence and adultery for decades and consuming drugs, alcohol, smoking are strong likely comorbidities to his present condition. A generic action "star", whose career took a sharp nose dive in quality over the last few decades while he coasted on his previous work, and churned out movies for pure greed, taking the place of another more qualified actor. This type of Hollywood elitism/ego/nepotism is really sickening, I have friends who struggle to break into the film industry and sadly this is the way of their "world".

Third guy sounds like the real winner, staying active and working to be useful to society. Enjoying his time, taking pleasure in the small daily occurrences of life.

 

[Luvtoride]

I read the article. The two quotes that stood out to me:

Both of these make sense to me. It has become clear to me, at this stage, that our active lifestyle is not going to cause us to run out of money, and that our best memories involve physical pursuits that will become more challenging over time as we age. For that reason, that is our focus today. DW fracturing her ankle in July, and just now getting her walking and swimming legs back, served as another wake up call for us about our future. Our best memories are less the new highs our portfolio may be hitting, and more the activities we enjoy engaging in .

Well said, Jolly! The pursuit of experiences with our family and having the money and health to do them is the most enjoyable part of this phase of our life!

Last weekend 10 of us (my kids their spouses and our grandkids ) attended the NJ Devils Hockey Fights Cancer game together (3 of us have fought 5 cancers). After the game, our family went on the ice for a group picture. What a great night it was for all of us.
Next month we are all going on a Caribbean cruise over Xmas til New Years. The whole family is excited for this experience.
To us, that’s what the concept of Bill Perkins and his book is all about!

 

[DrRoy]

You could say that I 'oversaved', but it is giving me the freedom to spend pretty much what I please now.

 

[Koolau]

You could say that I 'oversaved', but it is giving me the freedom to spend pretty much what I please now.

"Oversave" = Flexibility!



A worthwhile "mistake" to make. SO much better than the other way around.