James Canall is the founder of the financial advice website Root Financial Partners, a CFP professional/financial advisor, and the podcast Ready for Retirement where he guides people toward a comfortable and prosperous retirement. I am. In a recent episode of the podcast series, Canole spoke to retirees who are facing a fundamental challenge: how to comfortably spend their money in retirement.
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Canole introduced his guest, “Ben,” as a man who “aggressively saved” so he could retire at age 53. However, while Ben is enjoying his retirement, he is finding it very difficult to spend money on certain things. Growing up with a single mother, Ben came to understand that money is “a very important conduit for us” and how much we need to value and appreciate it. As he grew older and saved aggressively to build a portfolio for early retirement, the value of his money only increased.
So Ben realized that his main problem in retirement was struggling to give himself permission to spend the money he had saved and earned. “I don’t want to say I’m in denial, but I often wonder if I am now,” he lamented.
Shifting to a “savings-to-spends mindset” was a problem he didn’t expect, but now it’s one he has to face, and his retirement spending actually continues to decline. But through Ben and Canole’s discussions, they came up with a way to overcome their fear of spending and allow Ben to enjoy his golden years.
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give yourself permission to spend
You’ve worked hard and planned ahead for retirement. This is the moment you’ve been saving up for. If you don’t spend money on yourself now, when will you?
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commit to spending decisions
If you’ve booked a vacation or planned a big purchase, make sure you do it. Ben said he had booked an expensive holiday for himself and his family, saying: “Once I made the decision, I didn’t regret it at all. I kept thinking that I had purposely put the money aside at the beginning of the year. You can do something like that.”
Create spending funds
Ben found it especially easy to go on that vacation because he had withdrawn all the funds he needed from his retirement portfolio several months earlier and created a “vacation fund.” By taking this leap a long time ago, I found it much easier to make spending decisions than pulling money out piecemeal during the holidays.
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Remember, your retirement savings are something you’ve worked hard for. You should never overspend, but now is the time to enjoy the comfortable life you deserve.
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This article originally appeared on GOBankingRates.com: 3 Ways to Overcome Retirement Spending Fears, According to Financial Experts
