Spend Now, Retire Later


My Friend’s Addiction

My 55-year-old friend, John, just came clean about an addiction – He watches CNBC every weekday morning for about 2 hours. By my count, if John’s habit started 10 years ago, he’s logged more than 5,000 hours listening to talking heads argue about the state of the economy and the direction of the stock market. Yet, John, who plans to work 10 more years, had no idea that he doesn’t need to wait until retirement age to start tapping into his retirement portfolio.

More Income Before Retirement?

Despite the recession’s impact on many nest eggs, there are plenty of professionals in their 50s who have a comfortable level of confidence with their future guaranteed income streams (pension, social security) and assets that will convert to income (401k, IRA, real estate).

John, for example, revealed that his pension will cover most of his expenses when he stops working at age 65. And he has no kids chomping at the bit for an inheritance or parents who will need financial support.  But he never thought about dipping into his after-tax investment portfolio for charitable giving, entertainment, or adventurous travel (while his knees and back permit).  A similar opportunity may present itself to professionals who intend to work into their 70s, but at a reduced income level (career change, less clients, consulting work, etc).

Like John, by staying focused on media commentary, what insights or financial opportunities might you be overlooking that could make a big difference in your life? When I asked John what he might do if he had an extra thousand dollars every month, he said it would be cool if he could give more to the local animal shelter. Naturally, there are other factors that could require John to need more income later than he’s budgeting for, but what a great time to see if there’s a dog waiting to be rescued or a mountain that needs to be climbed.

Happy spending,


The opinions expressed are those of the author and are subject to change without notice in reaction to shifting market conditions. This blog is provided for informational purposes, and it is not to be construed as an offer, solicitation, recommendation or endorsement of any particular security, products, or services.