I'm 70 Years Old and I Can't Spend My Savings

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
afan
Posts: 7282
Joined: Sun Jul 25, 2010 4:01 pm

Re: Still cheap, what to do?

Post by afan »

smitcat wrote: Fri Nov 18, 2022 10:20 am If you knew you only had a year left to live, what would you want to do?
What would you say to folks? Who would you visit? What would you experience? What would you purchase?
The only thing I would purchase would be a last round of estate planning. Much of the complexity and uncertainty in estate planning revolves around not know when one will die. If I knew I would die in a year, then things would become much clearer.

There is not something else that I have always wanted to buy and this would be my last chance.

There are no trips I would take. In fact, I would simply refuse to do any more work travel and that would be the end of my traveling days.

There is no special restaurant at which I would eat. There are many expensive restaurants that I would continue to avoid.

I MIGHT take more time so I could read and learn some things I had always wanted to learn. But the things I want to read and learn would take much more than a year. With only a little time left, I could not make a dent, so I might not bother.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama
doobiedoo
Posts: 357
Joined: Fri Jul 23, 2021 1:10 pm
Location: Southern CA

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by doobiedoo »

1. There's nothing wrong with not spending your money ---- IF YOU ARE HAPPY!

2. Now if you are not happy, then you have a problem. And spending money might help. But spending money on things that don't mean much to you will not make you happy.

3. So the trick is to find things, experiences, people, causes, etc. that make you happy -- or at least bring joy into your life. Spend money on those things. That's what I do. And I don't have a withdrawal rate. That just feels like [self-imposed] pressure to meet a goal that I don't care about!

P.S. Many of the suggestions on how to spend more money are some variation of behavioral modification. Nothing wrong with that if you want to try it. But at 70 [or so], it's probably tough to accomplish.
ThankYouJack
Posts: 4789
Joined: Wed Oct 08, 2014 7:27 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by ThankYouJack »

Along with spending to increase happiness, it's worth spending to increase health. If one prefers a salad, being fine with it costing 3x more than a Big Mac...being fine spending $60/month on a gym membership...entering an athletic competition. Maybe think of it as long-term ROI.
doobiedoo wrote: Tue Nov 22, 2022 4:53 am
P.S. Many of the suggestions on how to spend more money are some variation of behavioral modification. Nothing wrong with that if you want to try it. But at 70 [or so], it's probably tough to accomplish.
I was thinking in terms of small steps and would hope that Bogleheads on here would be able to convince others asking for help spending insignificant amounts. But maybe not. Admittedly I struggle with some of the same things myself. Old habits die hard.
smitcat
Posts: 9913
Joined: Mon Nov 07, 2016 10:51 am

Re: Still cheap, what to do?

Post by smitcat »

afan wrote: Mon Nov 21, 2022 7:37 pm
smitcat wrote: Fri Nov 18, 2022 10:20 am If you knew you only had a year left to live, what would you want to do?
What would you say to folks? Who would you visit? What would you experience? What would you purchase?
The only thing I would purchase would be a last round of estate planning. Much of the complexity and uncertainty in estate planning revolves around not know when one will die. If I knew I would die in a year, then things would become much clearer.

There is not something else that I have always wanted to buy and this would be my last chance.

There are no trips I would take. In fact, I would simply refuse to do any more work travel and that would be the end of my traveling days.

There is no special restaurant at which I would eat. There are many expensive restaurants that I would continue to avoid.

I MIGHT take more time so I could read and learn some things I had always wanted to learn. But the things I want to read and learn would take much more than a year. With only a little time left, I could not make a dent, so I might not bother.
That is fantastic - our list is still rather long, but everyone is different
User avatar
nyc212
Posts: 119
Joined: Mon Oct 22, 2018 12:06 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by nyc212 »

Small Law Survivor,

This is an interesting post. You commented that you "can't spend money without feelings of anxiety," but I couldn't really discern the source of your anxiety. Maybe it really isn't anxiety but rather many years of common sense frugality and saving. This approach makes sense to me, especially in an era where the norm is to overspend and overextend credit card use.

In reading your post, my source of anxiety would stem from the combination of estate documents that were not updated and counting on spending 3% of your assets annually. (I'm not sure if 3% is a portion of the annual yield or dips into the principal.) My husband and I are of similar age to you, with slightly more ample assets, yet I worry about the unpredictability of life expectancy, unexpected health care issues and the possibility of becoming dependent on others. Dipping into principal is a big "No No" for me.

Seems like you should commend yourself for your current circumstances and continue to live conservatively while at the same time enjoying life and not depriving yourself.
nyc212
flyingaway
Posts: 3757
Joined: Fri Jan 17, 2014 10:19 am

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by flyingaway »

First get rid of your part-time job and focus on spending money for happiness. Get on a cruise ship.
bighatnohorse
Posts: 445
Joined: Thu Oct 13, 2016 4:04 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by bighatnohorse »

Personally, I refer to this table for an "odds" check on how much time I have left: https://www.ssa.gov/oact/STATS/table4c6.html

And use this phrase in a Google search: how long does inherited wealth last

Then do the math.
gavinsiu
Posts: 1152
Joined: Sun Nov 14, 2021 12:42 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by gavinsiu »

YOu have a similar issue suffered by my mom. After she retired, she become anxious because she no longer get a regular paycheck. As a result, she then lives on social security and her tiny pension and drops on the portfolio when she must. Every time she draws on it, she worrys that she will run out of money even though she was withdrawn 0.001% of the portfolio. She tells her relative that she is destitute.

My suggestion is to start small and spend some money. You have like 6 million. I don't know what your expenses is like, but you can like start with spending 1% of your income. Maybe afterwards, you wil notice that the sky has not fallen and you can increase and decrease the amount. Just start small.

Keep in mind that if you are happy not spending money, then there's no need to spend it. However, you might want to do some estate planning to ensure that your money gets used after you pass away. YOu might want to have a talk with your wife since she might have a different spending habit. Definitely use the money to help your kids as long as it helps them toward financial independence instead of becoming their piggy bank.
User avatar
whodidntante
Posts: 11720
Joined: Thu Jan 21, 2016 11:11 pm
Location: outside the echo chamber

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by whodidntante »

bighatnohorse wrote: Tue Nov 22, 2022 4:30 pm Personally, I refer to this table for an "odds" check on how much time I have left: https://www.ssa.gov/oact/STATS/table4c6.html
Well, that's depressing.
User avatar
Doom&Gloom
Posts: 4834
Joined: Thu May 08, 2014 3:36 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by Doom&Gloom »

whodidntante wrote: Tue Nov 22, 2022 8:27 pm
bighatnohorse wrote: Tue Nov 22, 2022 4:30 pm Personally, I refer to this table for an "odds" check on how much time I have left: https://www.ssa.gov/oact/STATS/table4c6.html
Well, that's depressing.
Yep.
But I'm not sure if it is more depressing to think that I might exceed the expected number of years or not reach them at all :oops:
User avatar
squirrel1963
Posts: 1159
Joined: Wed Jun 21, 2017 10:12 am
Location: Portland OR area

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by squirrel1963 »

If not spending money makes you happier then there is nothing wrong with that.
My wife and I are also very frugal, and our yearly income from the TIPS ladder and dividends is quite a bit higher than our average expenses so far.
On the other hand my perspective has radically changed 2 months ago when I was diagnosed with stage 4 cancer. It's highly unlikely that I will live more than 5 years, so my wife will most likely die with far more than what we have now (she's the most frugal of the two of us).

So in retrospect I should have retired 5 years ago at 55 when we knew we had enough for our lifestyle, and enjoyed 5 good years. On the positive side our 2 daughters will get a sizeable inheritance, and as long as they act responsibly with the money, they'll be financially independent (we have been giving quite a bit of money to them already and up until now they just invest it and spend nothing, so I have hopes they won't waste it).

The morale of this story is that frugality is good, but if you have more than enough (and you do), then maybe enjoy it because you just don't know what life will throw at you.
LMP | Liability Matching Portfolio | safe portfolio: TIPS ladder + I-bonds + Treasuries | risky portfolio: US stocks / US REIT / International stocks
doobiedoo
Posts: 357
Joined: Fri Jul 23, 2021 1:10 pm
Location: Southern CA

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by doobiedoo »

whodidntante wrote: Tue Nov 22, 2022 8:27 pm
bighatnohorse wrote: Tue Nov 22, 2022 4:30 pm Personally, I refer to this table for an "odds" check on how much time I have left: https://www.ssa.gov/oact/STATS/table4c6.html
Well, that's depressing.
When financial planners used to ask me how long I expected to live, I always said 120 years. That number usually broke their model and they generally said let's use 100. I guess now I know why!
WhiteMaxima
Posts: 2795
Joined: Thu May 19, 2016 5:04 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by WhiteMaxima »

What’s your asset allocation now?
User avatar
whodidntante
Posts: 11720
Joined: Thu Jan 21, 2016 11:11 pm
Location: outside the echo chamber

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by whodidntante »

doobiedoo wrote: Tue Nov 22, 2022 9:45 pm
whodidntante wrote: Tue Nov 22, 2022 8:27 pm
bighatnohorse wrote: Tue Nov 22, 2022 4:30 pm Personally, I refer to this table for an "odds" check on how much time I have left: https://www.ssa.gov/oact/STATS/table4c6.html
Well, that's depressing.
When financial planners used to ask me how long I expected to live, I always said 120 years. That number usually broke their model and they generally said let's use 100. I guess now I know why!
Ha! They might want to update their software. According to a Harvard longevity researcher, the first person to live to 150 has already been born. They are probably closer to zero years than I am, though.
User avatar
Mel Lindauer
Moderator
Posts: 34140
Joined: Mon Feb 19, 2007 8:49 pm
Location: Daytona Beach Shores, Florida
Contact:

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by Mel Lindauer »

A number of years ago, my Forbes editor was getting ready for retirement and was concerned about what it was like with no paycheck coming in. She wanted to pick my brain, asking what it was like.

As a result of that conversation, I ended up writing a three-part series related to this subject/problem. I interviewed a number of forum members for these columns (you may recognize some of the names).

Here are links to the three columns.

https://www.forbes.com/sites/theboglehe ... 58939e7adc

https://www.forbes.com/sites/theboglehe ... 588ab42f1f

https://www.forbes.com/sites/theboglehe ... d9c938675b
Best Regards - Mel | | Semper Fi
GeoMetry
Posts: 162
Joined: Mon Jan 31, 2011 8:26 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by GeoMetry »

If the anxiety is due to a fear of running out of money, use some of your money to buy an annuity. Then you should be able to spend your annuity checks each month without any fear because you will get another one every month for the rest of your life.
bighatnohorse
Posts: 445
Joined: Thu Oct 13, 2016 4:04 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by bighatnohorse »

Perhaps you have a subconscious realization that you should be helping others.
Resolve that issue and the fear of spending money may dissipate.
delamer
Posts: 15137
Joined: Tue Feb 08, 2011 6:13 pm

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by delamer »

squirrel1963 wrote: Tue Nov 22, 2022 9:36 pm If not spending money makes you happier then there is nothing wrong with that.
My wife and I are also very frugal, and our yearly income from the TIPS ladder and dividends is quite a bit higher than our average expenses so far.
On the other hand my perspective has radically changed 2 months ago when I was diagnosed with stage 4 cancer. It's highly unlikely that I will live more than 5 years, so my wife will most likely die with far more than what we have now (she's the most frugal of the two of us).

So in retrospect I should have retired 5 years ago at 55 when we knew we had enough for our lifestyle, and enjoyed 5 good years. On the positive side our 2 daughters will get a sizeable inheritance, and as long as they act responsibly with the money, they'll be financially independent (we have been giving quite a bit of money to them already and up until now they just invest it and spend nothing, so I have hopes they won't waste it).

The morale of this story is that frugality is good, but if you have more than enough (and you do), then maybe enjoy it because you just don't know what life will throw at you.
I’m sorry about your diagnosis.

At its most basic, the retirement decision is the tradeoff between time and money. But that can be hard to reconcile since, as you said, the future is unknown.
One thing that humbles me deeply is to see that human genius has its limits while human stupidity does not. - Alexandre Dumas, fils
JackoC
Posts: 3903
Joined: Sun Aug 12, 2018 11:14 am

Re: I'm 70 Years Old and I Can't Spend My Savings

Post by JackoC »

whodidntante wrote: Tue Nov 22, 2022 10:10 pm
doobiedoo wrote: Tue Nov 22, 2022 9:45 pm
whodidntante wrote: Tue Nov 22, 2022 8:27 pm
bighatnohorse wrote: Tue Nov 22, 2022 4:30 pm Personally, I refer to this table for an "odds" check on how much time I have left: https://www.ssa.gov/oact/STATS/table4c6.html
Well, that's depressing.
When financial planners used to ask me how long I expected to live, I always said 120 years. That number usually broke their model and they generally said let's use 100. I guess now I know why!
Ha! They might want to update their software. According to a Harvard longevity researcher, the first person to live to 150 has already been born. They are probably closer to zero years than I am, though.
Using the Social Security table means saying your life expectancy prospects are indistinguishable from the average American. That's relatively unlikely. Who thinks their LE prospects are indistinguishable from the average person in the world? The confusion might be that with other hats on (citizen, altruist etc) we might reasonably care what other people's LE prospects are, and perhaps particularly about LE in our own country (or not, that's a value judgement outside the scope here). But it still doesn't mean the SS table, reflecting typical situations that vary by social strata and regions in the US pretty markedly, also including people who are already seriously ill, applies to each of us.

OTOH if one's prospects as a fairly old person now (who wouldn't benefit from anti-aging technology breakthroughs decades from now) are really an LE of 100 not to mention 120, SPIA's are a screaming buy. There are inflation issues (for non-CPI adjusted SPIA's practically the only kind now) and credit issues with SPIA's but those get swept away IMO if one can actually reasonably estimate their LE as 100.
Post Reply