When it Comes To Preparing For Retirement, When Is Enough, Enough?

When it comes to retirement saving, is there ever a point where you have enough and can stop saving?

Are there ever scenarios when you have saved enough for retirement? Can you stop saving at some point?

One of the first things we do for people is to work up a financial plan. We put in all the inputs:

  • Pension amounts
  • SS amounts
  • Asset amounts

Then we get goals, expenses, and where the money will be spent. What type of lifestyle do you want to live?

The financial plan can be condensed down to a picture.

Starting with $500k, paying all the expenses and accomplishing all the goals that you set shows you die at age 100 with $4.6 million. As my kids would say, #Enough.

You have enough. Indeed, you have more than enough.

So if that is the case, should you keep saving in retirement? Let’s look at some numbers.

Another example

Here is a different example.

Imagine a $500k balance, contributions of $15k a year, estimating an 8% growth rate.

In the first year, it grows by $41,200. It grew $15k because you kept saving, but it grew $41k just because the nest egg was big enough to grow on its own.

In year 10, you are still contributing $15k, but the growth is estimated at $97k. You can see that once you get the nest egg big enough, the growth takes care of itself. Adding more may not be necessary.

How do you answer the question, “How much is enough?”

Well, the Biblical answer for how much is enough is the amount you have right now.

Do you know how many verses in the Bible are about money? Over 2,300. Hebrews 13:5 says to keep your life free from the love of money and be content with what you have.

When you get a financial plan done, and it shows that you have enough to meet your lifestyle requests, what do you do then?

That gives you options.

  • Increase your lifestyle
  • Help your children/grandchildren
  • Give money away
  • Pay down debt

I have met with a lot of people where we do a financial plan, and it shows with reasonable growth rates, they can make it to their 90’s and die with $6 million, $7 million, maybe $10 million.

Do you know the response that I hear most?

That doesn’t interest them.

Most people want enough. And they can see that $10 million is way more than enough.

  • Have you reached the point where you don’t need to save anymore?
  • Do you want to sit down with somebody and have a financial plan done so you can see if you have reached the point where you don’t have to save anymore?

Reach out to us here at Christy Capital. We would love to talk to you to see if you qualify to get a financial plan done. It really shows you the possibilities for your retirement can look.

About the Author

Mel Stubbs is a Financial Planner and educator at Christy Capital who works with federal employees all over the country, teaching them how their retirement system works and how to plan for retirement using their available benefits.