What Good Is Money If You’re Not Going To Enjoy It?

If you knew you were on track to have more than enough money to last you the rest of your life, would the “responsible” part of your brain allow you to really enjoy it?

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After spending a few decades working hard, saving diligently and living frugally, many Canadians have managed to build up a significant retirement “nest egg”. One of the downsides to all those years of financial responsibility is that it can be hard to change your habits and mindset about money once you reach the point of having more than enough money to last the rest of your life. Even if you can afford something you really want, you may find you deprive yourself of that item because you feel it is too expensive, or because you worry that you may run out of money if you spend too freely.

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We all know the old saying that “money can’t buy you happiness”, but it absolutely can buy you more of the things that you enjoy (if you are willing to spend it). Sharing it with loved ones more in need of it and seeing it improve their lives can also bring you satisfaction and joy.

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This may be an unpopular take as an advisor, but I get much more fulfillment from seeing my clients (*that are in strong financial situations) spending their money and enjoying their golden years than I do from them maintaining their current lifestyle and continuing to accumulate money and having a bigger number on their statements. One of the challenges I recognize as people age is there are fewer things they can spend their money on, especially in the later stages of life. Someone who loves classic cars, but who can no longer drive, isn’t going to get much enjoyment out of a car that can otherwise help them relive their youth. Physical limitations in older age can also limit you from being able to travel in retirement, when you finally have the time and money to do so. Buying a bigger, fancier house also may not make much sense if going up and down stairs presents a challenge or hazard.

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For those who are financially secure and who can’t find enough things to spend their money on and who find their nest egg continuing to grow in retirement, one of the other best options for doing something meaningful and rewarding with that money is to start gifting it to their children and/or grandchildren. My dad has a saying (although it may not be his own saying) that “it is better to give with warm hands than with cold ones”. For money that is eventually going to be passed down as an inheritance, gifting some of that money early can give you the satisfaction of seeing it be enjoyed by a generation that isn’t as financially well-off, and/or that is going through a more expensive stage of life.

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Running out of money is a valid concern for many people. However, I am coming across an increasing number of people whose regular monthly income (pension/CPP/OAS) exceed their regular monthly expenses by a healthy amount, and who also have a nest egg that keeps growing. It is people in this situation who I encourage to treat themselves and enjoy their money, or to potentially gift money early to those who will ultimately inherit it so they can enjoy it now. We can all probably think of several people we know who worked hard and saved for retirement, only to pass away suddenly without having a chance to enjoy much (or any of) retirement and be able to spend the money they worked so long and hard accumulating. As much as people need to plan and prepare to live a long life, they also need to balance that with a bit of a “live for today” mentality.

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One of the greatest values a good advisor can provide their clients is not just the advice they give, but the perspective they can provide. Being able to run retirement income projections and determine that someone likely won’t spend all their money before their expected end of life is one thing, but helping them change ingrained spending habits and use that money to get more satisfaction and enjoyment out of life is entirely another thing.

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Finding that balance between “living your best life” and not running out of money prematurely starts with having a financial plan done. If you would like to start getting on track to be able to enjoy your life to the fullest, without worrying about running short of funds, please reach out and we at Endeavour would be happy to help!

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^{This information has been prepared by Dennis Rubeniuk who is a investment Advisor for iA Private Wealth Inc. and does not necessarily reflect the opinion of iA Private Wealth. The information contained in this post comes from sources we believe reliable, but we cannot guarantee its accuracy or reliability. The opinions expressed are based on an analysis and interpretation dating from the date of publication and are subject to change without notice. Furthermore, they do not constitute an offer or solicitation to buy or sell any of the securities mentioned. The information contained herein may not apply to all types of investors.}

^{iA Private Wealth Inc. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. iA Private Wealth is a trademark and a business name under which iA Private Wealth Inc. operates}