retirement savings Archives

The Regret of Over-Saving: How to Balance Financial Goals and Family Moments

4 February, 202525 March, 2025 Updated on25 March, 2025 Investing, Retirement, Superannuation

A client once shared a poignant regret: “When I was working and the kids were young, I saved too much. It restricted what we did when the family was together.” This simple reflection struck a chord with me. It got me thinking about the delicate balance between saving for the future and living fully in the present. While we all know the importance of financial security, is it possible to save too much—at the expense of the moments that matter most? The Common Paradox of Life We’ve all heard the saying: It’s a cruel irony, isn’t it? In an ideal world, we’d flip the script, having the means to enjoy life when we’re young and energetic while still securing a comfortable retirement. But life rarely works that way. Many people save diligently during their working years, focused on paying off their home, raising their children, and building a retirement nest egg. Yet, some arrive at retirement with a bittersweet realisation: “We saved too much. We missed the chance to create memories when we had the time, energy, and our family around us.” Building Memories to Reduce Regrets For me, financial planning is about more than just numbers; it’s about reducing regret. In retirement, your job is to build memories and enjoy the life you’ve worked so hard for—not just watch your portfolio grow. And this begins long before you retire. Ask yourself: It’s important to recognise that once your children are grown, they’ll have their own lives, responsibilities, and families. The time to connect, travel, and create lasting memories is when they’re still with you. How Do You Know If You’re Saving Too Much? Finding the right balance between saving and spending isn’t easy. It’s why I often turn to one of my most valuable financial planning tools: long-term projections. This approach gives clients a clearer picture of their financial future, helping them make informed decisions about spending today versus saving for tomorrow. The Empty-Nester Advantage One key insight from decades of financial advising is that there’s often a natural progression in savings capacity: This shift often happens in the last 10-15 years before retirement, providing a window to accelerate savings without compromising your quality of life earlier. A Call for Balance This isn’t a green light to spend recklessly or ignore the importance of saving for retirement. Rather, it’s a reminder to strive for balance: Because once retirement and old age set in, the regret of missed opportunities is something no amount of money can fix. Final Thoughts Finding the balance between saving and living is one of the most challenging aspects of financial planning. But with the right tools and mindset, it’s possible to enjoy the best of both worlds: a secure future and a present filled with memories you’ll cherish forever. As always, this is general advice. For tailored financial planning, I recommend speaking with a qualified adviser who can help guide your unique journey. The information provided in this article is general in nature only and does not constitute personal financial advice. 

Is FORO ruining your retirement?

4 September, 20243 September, 2024 Updated on3 September, 2024 Education, Finance, Retirement

FORO – the fear of running out. I’d never heard the expression until I met Mark and Susan. Of course I’d heard of FOMO, the fear of missing out, but never FORO. As the newly-retired couple sat across from me, explaining how they were so afraid of running out of savings that they were not enjoying the retirement they’d worked so diligently for, I grasped the meaning of FORO immediately. They rarely went out for dinner, bought anything new or – heaven forbid – took a holiday. After a lifetime of saving hard, paying off a mortgage and raising a family, Mark and Susan were naturally frugal, but FORO had left them feeling vulnerable and afraid of the future. After two decades as a financial planner, I’d come across this situation before, although, it is unfortunately becoming more common. Mark and Susan had never sought financial advice before and weren’t sure what I could do to help, but came to see me because they didn’t know where else to turn. When I assured them that there was plenty I could do to help, they visibly relaxed. I explained that the key to overcoming FORO was having a well-structured financial plan. After I outlined my 5-step strategy, they were eager to proceed. The steps we took were as follows: 1. Conduct a financial assessment By thoroughly assessing their current financial position (superannuation, savings, investment and social security entitlement), I formulated a picture of where they were at, and their future cash flow projections. 2. Establish a sensible strategy Working together, we identified essential living expenses and discretionary expenses, then allocated funding that balanced financial security with lifestyle goals. Next, we determined a retirement investment portfolio with a sensible withdrawal rate to support their retirement plans. 3. Create an emergency buffer In my experience, the what if factor is a major concern for retirees. What if…I become ill? What if…the fridge breaks down? What if…the car dies? These questions, and more, play on peoples’ minds to the point where they fall back into a FORO mind set. To ease their anxiety, I recommended they include a contingency fund in their portfolio to ensure that unplanned expenses were covered. That way, if something unexpected pops up, their retirement lifestyle strategy remains on track. 4. Enjoy the early years FORO had been holding Mark and Susan back for too long. I explained that hobbies, travel and social activities are crucial to mental well-being. So once we had established a responsible financial plan, I showed them how they could afford to spend, sensibly, and enjoy themselves. I especially encouraged them to make the most of their early retirement years, while they were fit and energetic. 5. Schedule regular reviews The final step in the process was my ongoing commitment to Mark and Susan. Retirement planning is not a set-and-forget strategy; it’s a journey through every stage of life – physical retirement being one of those stages. By regularly reviewing their financial position, I helped Mark and Susan monitor their spending and investment performance, and made portfolio adjustments that kept them in control of their retirement plan. Last week I bumped into the couple on the street. They were glowing with excitement and told me they’d just booked a Pacific cruise. Of course, I was thrilled for them – it was a big tick off the bucket list! But when Susan said they’d turned FORO into FOMO and were living their best lives, well, I’ll just say it was one of those moments when I absolutely love my job! The information provided in this article is general in nature only and does not constitute personal financial advice. 