Your Savings Are Worthless If You Don't Do This In Retirement

[target2019]

The numbers were born of hard work, sacrifice, and dreams.

 

[Original Wally]

I have often thought of it like this... Money is a tool. It's like my FIL's neighbor who boughgt a "boat load" of tools for his workshop... but never used them. Money is a tool. It SHOULD be used (Judiciously!)

 

[Koolau]

I don't see "underspending" as a risk. We spend what we want. If our wants are less than our assets and there is some left when we die, I don't care.

Right. We've just begun the process of estate planning (beyond wills which we have, though they are old). SO I plan to spend the money now or from the grave - just as I want to. With that in mind, it doesn't matter if I have "too much" at the end. I have done what I want with what I have. Anything I really want, I buy or do. The remainder may help someone else and that makes me feel great. What could be better. I'll likely skip the video unless someone points out something that shouldn't be missed.

 

[Koolau]

Yeah, risk wasn’t the right word.

We certainly don’t plan or expect to die with zero. If all goes well, I hope to die with millions more than we started with. Firecalc has us ending with as much as $29 million if our current spending continues.

I am impressed!

 

[Koolau]

We have one daughter and I hope we leave her set for life. Beyond that, I hope we're able to make significant donations to charities that we care about. The sort of donations where they name things after the donors, not that I care about that at all, but that level of support.

Right. I hope to be able to leave enough to be remembered but instead be forgotten. If there is a reward, it will be in the next life and I'd rather have that reward though YMMV.

 

[disneysteve]

I am impressed!

The Firecalc numbers are wild. You could die with $1,000,000 or you could die with $30,000,000. I’m sure the reality will lie somewhere between those extremes. Probably toward the lower end, but historically who knows?

 

[COcheesehead]

The other interesting thing about FireCalc is you can die with $1 and it’s considered a successful outcome.

 

[RetiredHappy]

The other interesting thing about FireCalc is you can die with $1 and it’s considered a successful outcome.

I guess funeral expenses unless pre-paid, better be specified in FireCalc.

 

[FD1000]

We’ve started spending more on things we genuinely enjoy, and it has definitely added more pleasure to our lives. But one thing I’ve learned is that “more expensive” often doesn’t mean “better.”

Examples:

• Clothes: I buy all my own clothes because I care about comfort and appearance and know exactly what I want. A couple of years ago, I went looking for a pair of jeans with a budget up to $120–140. I tried everything from Walmart to expensive designer stores. I actually bought several pairs and used them in the house to compare them properly. In the end, the best pair for my needs came from Walmart for just $20.
• Shirts: Lately, I’ve become obsessed with very comfortable shirts that work well in hot weather. I keep finding excellent options on Amazon for a fraction of the price of well-known premium brands, and most of the time they’re even more comfortable.
• Vehicles: A couple of years ago, we searched for a new vehicle. Our priorities were comfort, quietness, and reliability. We tested cars ranging from $30K to $70K. The one we liked most cost around $35K, the comfort and quietness were the same, and it also happened to be the best-looking. The $50K+ models had faster acceleration, but we simply didn’t care about that.
• Hotels: Decades ago, we stayed at Motel 6. Today, we usually book solid 3–4 star hotels, but still avoid overpriced luxury places. Booking.com has been great for finding excellent smaller B&Bs. We’ve never cared about fancy lobbies. What matters to us is a quiet, spacious, comfortable room, a good breakfast, and easy access to attractions. We just came from Greece and I found great 4-star hotels at $120 instead of $300.
• Restaurants: My favorite restaurant serves simple, excellent food for about $13–18 per entrée. The portions are so large that we often split one main dish plus an appetizer. I’ve eaten at restaurants charging two to four times more, and they weren’t any better so why bother?
• Flights: Short domestic flights don’t matter much to us. On longer flights, the only thing that would really matter is whether I could sleep more, and the answer is definitely no. The light, noise, turbulence, and interruptions still wake me up. I typically sleep about three hours regardless in an 8-hour flight. I get up to stretch every 30–45 minutes. After landing, we usually pick up the rental car and immediately drive out of the capital city. Our first-day drive is often around two hours. If we’re tired, we take a quick 15–20 minute nap in the car. In the middle of the drive, after a 30–60 minute drive, we hike 2–3 miles before checking into the hotel around 3–4 PM. The hiking has been the fastest way to acclimate. By the next day, we’re fully rested and ready for another packed 10-hour day of activities and experiences. We’re not stiff or miserable after flights. Sure, first class would be more comfortable, but I still wouldn’t sleep more, and the price difference is ridiculous. For me, real sleep requires lying flat in a straight bed with a proper mattress, temperature, and darkness, and none of the first-class seats provide that experience in the flights we took.

We spend money on many things that genuinely bring us pleasure, joy, and memorable experiences. But paying three or four times more rarely adds even 1% more enjoyment.

 

[disneysteve]

I guess funeral expenses unless pre-paid, better be specified in FireCalc.

Well that would be covered by the unused annual spending for that year as long as you don’t die at the very end of the year.

 

[RetiredHappy]

Well that would be covered by the unused annual spending for that year as long as you don’t die at the very end of the year.

I was replying to the $1 at end of life as being successful comment.

 

[Dtail]

The Firecalc numbers are wild. You could die with $1,000,000 or you could die with $30,000,000. I’m sure the reality will lie somewhere between those extremes. Probably toward the lower end, but historically who knows?

If you retired in 1982(IIRC), then you would have had 30m. lol

 

[disneysteve]

I was replying to the $1 at end of life as being successful comment.

Oops. Sorry about that. Scrolling too quickly.

 

[anethum]

My parents both needed expensive end-of-life care, which they could afford thanks to lifelong LBYM behavior. They were frugal but not cheap. Both lived very long lives, died in their own home, and were kept about as comfortable as was possible during their years of decline. But that level of care doesn't come cheap. I doubt they wouldn't have wanted their nest egg to have been spent that way (both had dementia at the end), but that's where most of their money went. Their home care alone cost around $1.2 million. That doesn't include their other significant expenses such as property taxes, utilities, food, insurance, & home repairs. So in their case, their lack of wasteful spending made their final years better than they would otherwise have been.

 

[Midpack]

Spend what makes you happy. If there's some leftover, no big deal.

I would agree within limits. And we are spending much more now that we did during my first 10 years in retirement. Even at new levels, FIRECALC says we'll die with $20M on average, somewhere between $6.5M and $49M. Though unlikely I would probably regret it if it's closer to the latter. That would make our heirs much better off than we were, and we don't have kids...

 

[Sunset]

I would agree to an extent. Right or wrong FIRECALC says we'll die with somewhere between $6.5 and $49 million. Though unlikely I would probably regret it if it's the latter. That would make my heirs better off than we were, and we don't have kids...

You can hope for a nasty depression so the values don't go up much

Or start spending more, buy nicer cuts of beef, or more luxurious travel.

I say all that and yet it's hard to overcome habits of frugality.

 

[Rustward]

I don't see "underspending" as a risk. We spend what we want. If our wants are less than our assets and there is some left when we die, I don't care.

This ^
We get what all we need, and most of what we want. I am not concerned that we probably will not spend it all.

 

[NameTaken2]

Accumulated wealth = our LTC insurance. LTC expenses are high/rising -not spending down.
Either goes to LTC, or to children w/estate.
Live simply, and have all we need, so this works for us.

 

[freedomatlast]

Just say YES to spending on something under consideration. BTD!

 

[cloyde]

I live in ultra-super-duper-high-cost San Diego and have never lived more inexpensively nor (given current health circumstances) more happily. My neighbor manages a local supermarket so anything and everything that's nearing expiration winds up in the freezer I had to buy to take care of the overload, mostly ribeyes, which is great, since I'm keto almost carnivore.

Housing? I rent a room from a nice woman for 25% of my monthly social security payment. No home repair bills, no nothing like that. I'm fairly disabled but still able to go (adaptive) surfing five, six, sometimes seven days a week. The water is seven minutes away from my room, by minivan. Around town, I go everywhere by electric bike. I've got enough money saved to live in a more opulent fashion but why would I? At my age? Given my health? Given my current state of ease and happiness?

LTC expenses? Forget about it. What do you think that tank of hydrogen is doing in my closet, god willing I still have the strength and commitment come the time?

Cremation costs? Burial costs? Get serious. I signed up for a UCSD program whereupon it gets notified upon you breathing your last breath, then sweeps in, then sweeps out with your mortal remains, and off to the teaching hospital "you" go, free of any costs at all, bingo bango, done done.

anyhow, those are the circumstances and those are the plans. how it all turns out is anyone's guess. and onward i wobble.

 

[athena53]

I'm having a great time spending away, donating to charity, buying plane tickets, funding the grandchildren's education, etc. My 3 grandchildren have a collective net worth of over $400,000 between 529s (yeah, I know, legally I own those) and UGTMAs!

But- to me, what's left in the pile is a security blanket and has value even if I'm not spending it. And, as NameTaken2, notes, it's LTC self-insurance. If I need it I don't want DS and family to be scrambling to find a facility that takes Medicaid.

Cremation costs? Burial costs? Get serious. I signed up for a UCSD program whereupon it gets notified upon you breathing your last breath, then sweeps in, then sweeps out with your mortal remains, and off to the teaching hospital "you" go, free of any costs at all, bingo bango, done done.

Cremation is pretty cheap and that's what I want, in addition to a proper Episcopal Church funeral with incense.

We'd looked into donation of the body to a medical school when DH was in his last months but they have some requirements and "emaciated" was a knockout factor, and it certainly applied to him.

 

[YellowSubmarine]

Most things are worthless if you fail to make use of it.

 

[ShokWaveRider]

Well that would be covered by the unused annual spending for that year as long as you don’t die at the very end of the year.

We do not worry about funeral expenses, not our problem. We do not have heirs, so again not their problem either. Funeral expense worries are only for the poor, we are not poor.

 

[audreyh1]

Agree about having plenty remaining to cover the potential LTC expenses.

 

[Out-to-Lunch]

The other interesting thing about FireCalc is you can die with $1 and it’s considered a successful outcome.

I agree the default is $1. But you know that you can specify a minimum residual estate under the "Investigate" tab, right?