Spent your money on things that really make you happy!

Retirees who have sufficient money saved are generally reluctant to spend it due to uncertainty about their future expenses, investment returns and life expectancy. Most of us go through life as if we have all the time in the world. But we actually don’t. The most valuable asset is not our wealth. It’s the amount of time we have left on this planet. If we have worked hard, saved enough, invested wisely and compounded your money for a long time, we should not delay gratification. Reward yourself and convert your hard-earned money into the things that make you happy.

Psychologists confirm that people gain more happiness from spending on experiences, especially joint experiences with others, than just adding more material things. Experiences actually gain in value over time, unlike material possessions, which quickly depreciate in value. But you don’t just enjoy a great experience. You also enjoy the memory of the experience, even more in the company of those with whom you shared it.

At the very end, the best part of your life are your memories. You can always look back on the life you lived and experience joy and the feeling of nostalgia. Therefore you should start to live more deliberately now as your health inevitably declines and so will your capacity to enjoy more new experiences.

Divide your retirement years into 3 categories:

1. Go-Go years
The go-go years are when you ‘re first retired and going for all the bucket-list experiences you have been putting off for so long.

2. Slow-Go years
Later on, depending on your health and fitness, you enter the slow-go years. You will still make memories but at a much slower pace.

3. No-Go years
In your 80s and beyond, you may find that you don’t have a lot of “go” left, no matter how much money remains.

Leaving this planet with a big pile of unspent money generally means you wasted a lot of life energy in earlier years for something that you will not benefit from anymore. If you are planning to give away part of your money, then do it now. Most will benefit more from getting some of your wealth now, rather than later.

Surprisingly, most retirees are saving more aggressively, living more frugally and spent their hard earned money more slowly than necessary. Retirees who had $500,000 or more at retirement, spend a median of only 12% of their money 20 years later or by the time they died. With other words: 88% of their wealth remained unspent! Even people with less than $200,000 saved had spent down only 25% of their assets after 18 years of retirement.

There is nothing wrong to spend more of your hard earned money wisely, once you retired. Spend it on experiences, better even joint experiences with family and friends, rather than material things. Reward yourself at the end of your life-cycle. You will live and die much happier.

Sven Franssen