Today’s Smart Money Question:
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Here Are Just A Handful Of Things You’ll Learn:
On today’s episode, we’re talking about the fear of spending money and how to get over that feeling, especially as you enter retirement. We came across an article that said, to have a better retirement you need to spend more money. Let’s dive into that opinion.
The number one fear we hear about is running out of money. People don’t want to burden their kids or move in with their kids. People like the certainty of getting a paycheck, and the fear of the unknown grips many people.
Studies show retirees simply do not spend as much money as they could from their different investments. So, how do you overcome that? You need to look at the sources of income you have, such as Social Security, pensions, and investments.
One way to get over the fear is to create income from different sources. With investment income, you need to figure out how much money you’ll need. This is where budgeting comes into play. Many people during their working years never thought about having a budget.
In our house, we determine how much we want to be investing and saving on a monthly, quarterly, and yearly basis. We have a mortgage budget and a healthcare budget, but those are the critical areas that we monitor.
Some people think they only need about 50% of their take-home pay in retirement, but that is usually wrong. You need to factor in inflation.
There are really three areas of your budget – keep the lights on, wants/bucket list items, and legacy to leave behind. You can create a budget and income plan from this.
Listen to the full episode or use the timestamps below to jump to a specific section.
3:22 – Spend more money
5:17 – The fear
8:43 – Three areas of budgeting
11:39 – Spending years
13:21 – Investments and distribution
“The number one fear I hear about is running out of money.“
-Matt Hausman
Additional Podcast Episodes:
- How to Handle an Unplanned Retirement
- Top Places to Retire and How They Affect You Financially
- How Much Money Do I Need to Retire?
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The host: Matt Hausman – Contact – Resources – Call: 610-719-3003
