Advise frugal clients to spend money on activities they look forward to as retirees – but to keep working. Saving during the years before retirement does less good than waiting before you draw your savings and take Social Security.
The big idea is that it is better that you stop saving and use that money to do some of the things you’ve been longing to do, than it is to quit your job and retire early because you think that is the only way you can achieve your goals.
This article supports many of the principles we advocate in comprehensive wealth management.
We often advocate continuing to work as there is great value both financially and spiritually. We also advocate structuring your finances to support your life-goals, and not the other way around.
We’ve also done extensive analysis of when to take Social Security benefits. The difference between the best and the worst times and methods for couples to take Social Security can be as much as a quarter of a million dollars. Blindly taking Social Security as soon as you are eligible is often the worst method, but in some cases a spouse taking spousal benefits as young as possible while delaying their own benefit can gain thousands of extra dollars.
We’ve especially found that frugal clients need help knowing that they have enough and can spend some of their money to meet some of their goals. Because of our firm’s minimums, most of our clients are frugal super-savers. In fact that is how you build wealth: Live well below your means and save and invest the difference. The opposite is that spend-thrift clients need help knowing that they don’t have enough and need to cut back on their lifestyle.
Either way, financial planning and comprehensive wealth management can help you structure your finances to meet your goals.