Considering taking foot off of throttle a bit...

[Cassius King]

Started thinking long and hard about slowing down my investing a bit. Been maxing out everything possible (401k,HSA,Roth) and am now focused on Brokerage and savings.
Wife and myself are in our late 40's, and have just over a $1m net worth.

I'm considering cutting back on the contributions a bit to allow us more free cash flow to travel and make home improvements now so that we can enjoy both. I'm having trouble with the idea of not "optimizing" my opportunity to invest. But as I age, and gather knowledge from the folks here I'm thinking a better balance of enjoying life now is in order.

Has anyone done this? Is this a feeling that will pass?

Thanks!

 

[scrinch]

Travel and home improvements are investments in your current and future quality of life. They should absolutely figure in your current cash flow picture. But only you can decide how much you can afford for each of them on an ongoing basis.

We're saving and investing so that we can have a good quality of life during our retirement years. But the quality of life today is just as important as the quality of life then. Try to find a way to manage your money so that you can enjoy today and still have a good chance of enjoying life after your w*rking years.

 

[pacergal]

Sounds like you are doing well.
what does firecalc or other retirement calculator's say about your desired budget and savings goal and where are you now in that?
Saving for the future is important, but so is living a bit along the way. You need to find your balance.

 

[COcheesehead]

Everyone is different, but I actually ramped up our saving in the years prior to retirement. We still traveled and enjoyed life, but saving was a priority. Your late 40’s, early 50’s are some of your prime earning years. We retired at 57 and now have all the time and money we need.

 

[WhenIsItTime]

Would this decision impact retirement date? Do you care?

As I accumulated wealth towards FI, my priority shifted to time. You can do things to hopefully extend life, but you can't control it. I think daily about whether I am using my time appropriately given all the required tradeoffs in life. I have friends who prioritize "enjoying the ride". My wife and I put FI towards RE ahead of enjoying the ride (although w/out major sacrifices). We FIRED <50. I'm very active and into early 50's now. Reminded daily that some things are easier when you are younger. I certainly enjoy each day's freedom. It's a blessing to be able to pick your own path. Best wishes as you chart yours.

 

[38Chevy454]

Compounding is where you will take the hit on the reduced contributions now. I agree that some home improvements are good for you, as well as some travel and taking a bit of time to enjoy your hard work to this point. Just consider the tradeoff may be another year or two working and saving.

 

[Car-Guy]

From my POV, "if you can", enjoy the ride getting to retirement "too". I could have save more while I was working but I started to take some nice trips and buy nicer cars, etc, in my ~mid 40's. Before that I really just couldn't. No regrets.

 

[Montecfo]

We always travelled during accumulation stage.

"There is a joy in the journey"
-Michael Card

 

[pb4uski]

More info is needed. Is the $1m of "net worth" $1m of financial assets and $0 home equity or $0 financial assets and $1m of home equity? You need to live somewhere. How much do you expect to need in retirement? If it is $1m of financial assets and $50k a year then you are probably in good shape but if it is $100k a year then you need to save more.

I suggest that you play around with FIRECalc. Put in your info on the Start Here page and SS and any pensions on the Other Income/Spending tab and on the Not Retired? tab put in your retirement year and $0 for future retirement savings. On the Investigate tab select the radio button at the bottom to have FIRECalc solve for the spending level that can be safely supported and click on submit. Is the result at 95% success enough for you to live on? If so, then you have enough now.

If not then rerun with different amounts of annual retirement savings between now and when you retire until the result is in your comfort range.

All of that said, we did something similiar to what you are thinking. When we were 50 and had substantial retirement savings we bought a seasonal lakefront home about 1/2 hour from our main home. While I continued to save ithe 401k and HSA, the cost of the lakefront home meant less money going to taxable accounts. Over time, we started living there over the summer and then in late 2010 demolished it and rebuilt for cash, moving in in May 2011. We sold our main home in late 2011 and made the lakefront home our principal residence. With one less house to support, I felt comfortable retiring.

 

[Aerides]

I'm considering cutting back on the contributions a bit to allow us more free cash flow to travel and make home improvements now so that we can enjoy both. I'm having trouble with the idea of not "optimizing" my opportunity to invest. But as I age, and gather knowledge from the folks here I'm thinking a better balance of enjoying life now is in order.

Even while saving, you are still living. You should still improve your home and travel and enjoy now. Continue to max your 401k if you can.

It's the cutting back "a bit" that's hard to work with. From what to what?

 

[OldShooter]

... Wife and myself are in our late 40's, and have just over a $1m net worth. ...

Guessing (like @pb4 implies) that your net worth includes a significant number for your home, I would not consider that to be a lot of money at your age. Play with the retirement calculators before you make any decisions along these lines. Even $1M of investable assets may not be a comfortable number if your future income needs are significant.

 

[Cassius King]

Thanks for the replies, much appreciated.

We're right at $1m with investments and cash ($250k home not included). Like was stated, we have to live somewhere, and the only reason we have been able to save this much was due to staying in our first home and not upgrading.

Wife and I both come from very humble beginnings, so the realization of $1m in investments is daunting to us. Even thinking about spending that kind of money is a challenge for us. As of such, why I'm having this thought process.

We'll keep building the portfolio up and try to fit the travel and home improvements in as we go.

Really appreciate this site and all of you. Thanks!

 

[Retch The Grate]

It is REALLY important to find a balance. You only have X years left. Y of those will be in retirement that your saving and investing is for. X-Y of those are for now. Make sure you enjoy now, not just a theoretical future when you are retired. Doesn't mean go hog wild, but does mean, yeah, it is ok to adjust what you are saving and spending and once you have a nest egg you feel is large enough that you don't need to amp its growth so much anymore, you shift a bit more to enjoying now.

Now your mindest matters a lot. If you are the sort of person who will spend way too much on toys if you let yourself off the hook, yeah, maybe that shift is bad. But if you are just talking about a very motivated saver and investor who is thinking "my models show I still get the retirement I want, when I want it, if I save $500 less a month and do a bit more travel", go for it. That's my household, things are on track, I don't care about maximizing value when I retire, I care about maximizing value over my remaining moments of existence from this one on, so a little less investing these days and a bit more concert outings and other things that make my wife much happier.

 

[pb4uski]

+1 balance is the key. I had a great uncle who scrimped and saved for 40 years for his retirement. He retired in his early 60s and six months later dropped dead from a heart attack while mowing his lawn.

Balance!

 

[Beer-man]

We pushed pretty hard in our 20's to save. My income has been eroded by inflation and unfortunate job and career changes so we took the foot off the gas on saving the past 3yrs. We actually barely save much anymore as our 3 kids and living expenses have outpaced our earning ability. Unless I get a major pay raise I don't see us going back to our high savings rate we once had. The kids are only here for so long. We have about 1 million saved and early 40's.

 

[DrRoy]

You should optimize your whole life, not just one part. I would do some travelling (and did).

 

[Closet_Gamer]

Life is for living. It is not a balance sheet exercise.

IMO, a life well lived involves good financial discipline and planning. But money is just a tool both now and in the future. It is not an end unto itself.

+1 to all of the advice to check out the long term math ...

... but provided it checks out, +10 to enjoying life as you go.

We traveled extensively with our kids. If you told me I could have those memories and experiences or $1M more in my retirement savings, I'd take the memories every time. When I got a bit older and the financial plan started to really solidify I started to drive sports cars. I could afford it and it makes me smile every time I turn the key.

But I currently really want a new gaming laptop for VR. Its probably $1500. I'm loathe to part with the money. Life is about choices ... you can have almost anything you want but you can't have everything you want.

Sounds like you're in a position to live a bit more. Just make good choices on where you spend that money.

Good job and good luck!