Finding Financial Balance: Don’t let your money outlive YOU!

We all strive for financial security. We work hard to save and invest for the future. But sometimes in the relentless pursuit of a robust retirement fund or investment portfolio, we lose sight of the present. 

We start putting off travel plans, charitable gifts, family experiences, bucket list adventures all in the name of maintaining and growing our savings. Then one day, we wake up and wonder where did the time go? Why didn’t I do and see all that I dreamed?

I recently heard a disheartening story about a financial advisor’s client who had accumulated over $5 million by retirement. Yet, they lived very modestly, never taking the European river cruise or other trips they imagined for decades. Why? They were afraid of spending too much and risking their financial stability.

When the client eventually passed away, they still had a majority of those savings fully intact.

This story leaves an unsettling feeling in my gut as a financial advisor. Here was someone so laser-focused on saving for the future and maintaining their accumulated wealth that they lost out on truly living in the present. They worked tirelessly their whole career to have financial security and never got to enjoy the fruits of their labor. 

It makes me reflect deeply on my own clients. Could this be you? Are you maintaining balance in your finances, or are you overly obsessed with growing your nest egg or overly worried about a market downturn? The stock market can be scary during periods of downward volatility – I get it!  Staying fully invested 100% of the time is the surest way to building wealth. 

Are you enjoying your wealth now through memorable experiences? Or are you putting off travel plans, charitable causes, family experiences worried about spending too much or tapping into your funds?

The Reality of Financial Regret

Financial regret is real and more common than you may realize. Studies show that over 50% of Americans have financial regrets. The top regrets include not saving enough for retirement, not paying down debt, not investing, and not budgeting properly. 

But there is another type of financial regret that I want to focus on today: the regret of not using your money to truly live life to the fullest. 

You see, money is a tool we can use to create joy, purpose, connection, and memories. Yes, saving is important. But the goal of proper money management is not only to have a secure financial future, but also to have a fulfilling present. 

Life is short, we never know how long we have on this earth. The true measure of financial success is living a life full of adventure, experiences, and time with loved ones. Not just accumulating wealth for wealth’s sake.

So How Much is “Enough”?

This raises the question how much savings is truly “enough”? How do we balance growing our money but also living life? 

The honest truth is there is no magic number or formula. Financial security means different things to different people.

Here are some questions to ask yourself when evaluating if you have enough savings:

• Am I on track to have enough put away for retirement based on my lifestyle and life expectancy?
• Do I have proper insurance policies and protections in place for risks like death, disability, major illnesses, lawsuits, etc.? 
• Could I cover at least 6 months of living expenses if I lost my job or main source of income?
• Can I afford healthcare and long-term care needs not covered by insurance later in life?
• Will my savings allow me to leave an inheritance or make charitable gifts that are important to me?
• If you can answer yes to these questions, you likely have enough saved to fulfill your planning and lifestyle goals.

But also ask:

• Are you putting off vacations, family experiences, hobbies, or charitable causes just to save more? Why?
• Do you live below your means, rarely treating yourself or loved ones to life’s joys? What is the trade-off?
• Are you following your passion, or just relentlessly pursuing money?

These questions help assess if you are sacrificing too much today just to have more for later. A few small lifestyle upgrades or added experiences could make your life exponentially more fulfilling without putting your financial stability at grave risk.

Finding Balance and Living Without Regret

The goal of all my wealth management is to help clients find balance. To have the savings you need but also the freedom and confidence to enjoy life along the way. 

Here are some tips to find that equilibrium in your own financial life:

1. Reassess your retirement plan. Do you have reasonable projections on how much you need to retire comfortably? If you have much more saved than needed, consider easing up.
2. Build in contingency funds for your savings for medical needs, emergencies, major purchases, etc. This allows peace of mind to enjoy extra spending while staying on track.
3. Allocate “fun money” in your budget for impulsive expenditures guilt-free. This could be a set amount each month to use on whatever brings you joy, no overanalyzing needed!
4. Schedule regular financial reviews to course-correct as life circumstances change. Major events like marriage, children, and a new career may allow for more flexibility in your savings plan.
5. Create a “wishlist” trips, gifts, causes that you can selectively fund when you have extra available. This curbs impulse spending but creates goals.
6. Consider securing a life insurance policy for legacy planning. This can allow tapping into more assets now while still leaving an inheritance.
7. Talk to a fee-only fiduciary financial advisor about your unique situation. They can help assess if your current savings trajectory makes long-term sense or is overkill. 

The Bottom Line

Life is short. We all have regrets over how we spent our time when it’s too late. I never want money to be one of those regrets for my clients. Yes, you need savings but you also need LIVING. 

Take a step back and look at your finances through this lens. Are you denying yourself joy and purpose just to oversave? Or are you finding a balance between prudently saving but also spending to enrich your life?

If you relate to this article and worry you may be over-compromising, reach out to me for a free consultation. I’m Shawn Ballinger, a fee-only fiduciary financial advisor with over 15 years experience. I’ll review your full financial picture to make sure you’re on track while also making the most of the time you have.

Don’t let money outlive you. With some planning adjustments, you can have peace of mind in your finances and fulfillment in your life. Let’s have a productive conversation on how to make that happen.

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