It’s no secret that I want you to spend more money in retirement.

Why?

Because you’ve worked for it!

Retirement is about living the life you have saved for all these years, so I’m looking for any way I can to help you get out there and enjoy it.

One way that has been gaining popularity in recent years is semi-retirement. In this episode of Retirement Starts Today, we’ll look at an article that shows how partial retirement has been shown to lead to an increase in spending levels in retirement.

Outline of This Episode

  • [1:22] How semi-retirement has led to a surge in retirement spending
  • [6:15] Would part-time work increase your spending confidence?
  • [7:48] Keep contributing to a simple IRA or cease contributions and move funds to a Traditional IRA

Phased retirements are gaining popularity

Recently I came across this ThinkAdvisor article highlighting a new study by J.P. Morgan. This study analyzed data from 280,000 households and revealed significant trends in how Americans approach retirement.

This study revealed that more than half of retirees don’t retire fully all at once. Instead, many engage in phased retirement. A phased retirement can be taken in a variety of ways: maybe one spouse retires while the other continues to work, or both spouses work part-time during retirement.

A phased retirement could equal more spending

Many partially retired individuals may be delaying full retirement due to financial necessity rather than by choice. This phased retirement trend revealed that these households tend to spend more, carry more debt, and have lower savings compared to fully retired households.

While don’t advocate carrying debt into retirement, I am a proponent of spending more money.

Spending your money within reason and as part of a plan is the key to a happy and fulfilling retirement.

A retirement plan is an important part of crafting financial security

Higher-income households have more flexibility in their spending, while lower-income households may experience significant changes in their spending behavior with additional retirement income.

The study’s implications for financial planning are significant. Effective debt and spending management early in the retirement planning process can foster greater retirement readiness and improve financial security.

What could you do to spend more money with confidence?

Overall, the study highlights the importance of understanding spending patterns and their volatility to design successful retirement plans.

Now is the time to start thinking about your retirement timelines, spending habits, and flexible income options so that you can navigate retirement uncertainties with better financial preparedness.

Have you ever considered taking a phased retirement? Would that improve your spending confidence? What will you do to spend more with confidence in retirement?

Resources & People Mentioned

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