Are You Living Too Conservatively in Retirement? A 4-Point Checklist

living too conservatively

Is your conservative spending plan in retirement putting a lid on your day-to-day happiness?

At Keen Wealth, we tailor financial plans to the specific needs and long-term goals of each client. But whatever tools and strategies we utilize, I think it’s safe to say that we’re helping folks stick to a “savings mindset.” And that’s a good thing! We’ve talked in recent blogs and podcasts about how important it is to get in the habit of saving and investing, especially for new workers (like your kids or grandkids).

However, some retirees are reluctant to transition out of this “savings mindset” once it’s time to retire. A common fear creeps in: “Am I going to run out of money?” Instead of enjoying the benefits of their hard work and prudent planning, these retirees live way below their means and end up shortchanging their happiness.

If your retirement plan has succeeded in transitioning you from full-time work, but is failing to make you happy, run down this checklist I’ve put together to determine if you’re living too conservatively.

1. Are you spending too much time at home?

Jack and Jill are a happy married couple. Then Jack retires, and doesn’t know what to do with himself. So Jack spends all day puttering around the house … and starts driving Jill bonkers.

“Retired hubby syndrome” is very real, and so are the potential consequences. There’s been a big uptick in divorce among seniors in the last 25 years, and even in less-acrimonious cases, retirees who withdraw from the outside world are prone to feelings of uselessness and depression.

Now I’m not saying that spending more money is the key to snapping you out of this funk, and I’m definitely not advocating any splurges that could throw your budget off. Everyone knows that buying stuff doesn’t buy happiness. However, many studies have shown that buying experiences makes people happier. Vacations and excursions, even modest ones, enhance your connection to the world and to those around you. Plus, vacation memories last a lot longer than that quick jolt of pleasure you get from buying a new TV.

So, if your budget allows, go on that dream vacation. Take lessons to refine your golf game. Set up a date night and take your spouse to the hot new restaurants in town. Travel to see your grandkids more often. Try things you’ve never tried before, but always wanted to. Get out there and enjoy yourself! You’ve earned it.

2. Are you withdrawing less than 4% per annum?

4% is not a magic figure that’s going to make or break how long your retirement assets last, but it is a pretty good baseline number for what a prudent retirement plan allows for annual withdrawals. If you have saved enough, but you’re withdrawing a lot less than 4% year over year, that might be a sign you’re stuck in the “savings mindset” and living more conservatively than necessary. We believe that your retirement and estate plans should establish guidelines that take care of your heirs, and any charitable gifts you want to leave behind. The rest? Well, as they say, you can’t take it with you.

3. Are you happy with the quality of your medical care?

Health care costs are often a big money worry for new retirees. Moving from your employer-subsidized health care plan to Medicare or Medicaid is a big switch, and the wealth of options can be confusing. Picking an affordable Medicare Supplement plan might seem like the smart thing to do, but the stress of jumping through hoops like HMOs and PPOs might not justify what you’re saving by living too conservatively. I highly recommend that you talk to a health care professional about your specific health care needs, and what options are available to you in your home state.

4. Are you in any chronic pain? Do you feel lethargic?

I’m not a doctor, but it doesn’t take a Ph.D. to know you have to eat! You have to sleep! You have to exercise!

Basic wellness is another area retirees often neglect if they’re living too conservatively. Throw out all that expired food – your budget probably allows more trips to farmer’s markets and quality grocers than you think it does. Throw out that old mattress and pillow – you spend a third of your day sleeping, and that rest needs to count, not send you to the chiropractor. Take walks, ride a bike, join a gym, take a yoga class – all great ways to get you out of the house more, while also improving your fitness.

Improve your quality of life.

So why do so many retirees tolerate these discomforts while living more conservatively than necessary? Because saving all their money makes them feel secure about their day-to-day happiness. These seniors feel good knowing they can pay their bills, or cover an unexpected home or medical expense. They don’t mind a crick in the neck from a shoddy mattress, or eating yogurt that would have tasted better a week ago, because they consider these inconveniences a small price to pay for the satisfaction of knowing they won’t run out of money.

Unfortunately, day-to-day satisfaction is more fragile than these folks realize. You may feel content in the moment, plunked down in front of the TV with a stale sandwich. But eventually, minor aches and pains, boredom, and a lack of creature comforts adds up to unhappiness with your overall quality of life. In other words, living too conservatively creates a short-term sense of security that plants the seeds for long-term unhappiness.

If you’ve gone down my checklist and the results suggest you might be living too conservatively, make an appointment with us, or your fiduciary advisor. Get a clearer understanding of your assets, your monthly budget, and your ongoing investment picture. Talking to your advisor could help snap you out of savings mode, and get you back on course for a happy and fulfilling retirement.

About Bill

Bill Keen: Living too conservatively in retirement can cause long-term dissatisfaction with your quality of life.

Bill Keen is a CHARTERED RETIREMENT PLANNING COUNSELOR℠ and independent financial advisor with more than 24 years of industry experience. As the founder and CEO of Keen Wealth Advisors, a registered investment advisory firm, he specializes in providing personalized retirement planning designed to help people thrive before and during their retirement years. With a passion for educating others, Bill regularly blogs about retirement planning, hosts the podcast Keen on Retirement, and has contributed to U.S. News and World Report, Reuters, Wall Street Journal’s Market Watch, Yahoo Finance, and other publications. Based in Overland Park, Kansas, Bill and his team work with clients throughout the greater Kansas City area and across the nation. To learn more, connect with him on LinkedIn or visit

Keen Wealth Advisors is a Registered Investment Adviser. Nothing within this commentary constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Keen Wealth Advisors manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed here. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.

Print Friendly, PDF & Email

30 Minute
Strategy Session