And just like that, it's fall! (September 2020)

In case you haven’t noticed, it’s a little darker in the morning, just a wee bit cooler (39 degrees overnight in NJ last week!), and those beautiful colors are magically popping up all over the place.  I hope everyone was able to relax and rejuvenate at some point this summer.  For our mental & physical well-being, we all need to do that, especially this year.  If you didn’t or need more, stop what you are doing right now, and block out time in your calendar, even if it’s a few weeks or months out.  You can make your plans later, just block out the time now.

Let’s turn our attention to one of our favorite pastimes as Americans, and not what you’d expect a financial planner to talk about doing more of: SPENDING.  This seems counter intuitive to building a sound financial plan, so let me explain.  I’m talking about spending more in the distribution phase (retirement), not the accumulation phase.  Let's assume you've already accumulated the wealth you need to live out the rest of your days without working.  Big assumption, I know, but play with me for a moment.  How do you access your monies in retirement as efficiently and effectively as possible?  We don't forget about the 2 E-words just b/c we're not accumulating anymore.  We should be focusing on efficiency and effectiveness in every stage of the planning cycle: Accumulation, Distribution, and Transfer.  Logically, the more wealth you’ve built, any inefficiencies will translate into much bigger waste!

So back to SPENDING.  Assuming no additional risk of running out of money and not leaving less to your heirs, what would you rather live on in retirement: the interest only from your assets or the interest and the principal from those assets?  Which would give you more money?  What about the tax impact?  What about just the logic and satisfaction of spending principal & interest?  Doesn't that make more sense?  Why did you save & invest, take risk, and delay your gratification your entire life if you never get to spend the money?  What if you could have a bigger impact on your charities while you’re still alive to see it, not just leaving them something when you die?

Some good food for thought on this topic that I hope will get you to think about what you really want your retirement to look like:  SPEND, ENJOY, & HAVE FUN.  Isn't that why we worked so hard in the first place?   And won't that prove to our children and grandchildren that if you do work hard, delay your gratification, there is a reward in the future?   Besides, when they see you spending all of that money, it'll make them really nervous about their inheritance.  They'll start working hard b/c they'll just assume you've gone and flipped your lid!  Don't worry, I won't tell them the truth.  ;-)

Enjoy the fall, enjoy your family, enjoy your friends, and enjoy life!

Stay safe,