Signs of Over-saving and Achieving Financial Independence

Recognize if you've surpassed your financial goals before saving more money, consider enjoying the fruits of your hard work.

### Signs You're Saving Too Much and How to Know When to Spend in Retirement
* 💰 " If you've surpassed your financial goals, know your number, and yet you're still not spending, it may be a sign that you're **saving too much**.
* 🎉  Consider consumption as a skill you have to learn, especially if you've been a **lifelong saver**.
* 🛠️  To know if you've reached financial independence and can start enjoying the fruits of your labor, stress-test your financial plan beyond just using rules of thumb like the **4% rule**.
* 🎿  Be cautious of getting ahead of your projections and assuming you're financially independent when you're **not close to your goal**.
* 📈 " On the net worth statement, you've got to be somewhat conservative because you're going through a **threshold of change that you can't reverse**.
* 🎯  To assess if you're on track with your financial milestones, check out the show titled "**Are you on track to becoming a multi-millionaire?**"

[Music] all right Bron we' talked about three of the four signs that you may be saving too much uh and this is an interesting one because again I think this is unique to our audience but you need to recognize if you've surpassed your financial goals. You already know that you've hit your number and you've done the things that you're supposed to do and you're where you're supposed to be at and yet you're still not saving. You've not been able flip that switch over to consumption it may be a sign that you're saving too much. Now look I I want to make sure we're clear I want people to do the do the work meaning you actually have calculated and this is why we did we did the the course and the tool know your number because you do need to figure out are you ahead of the curve are you behind the curve if you're on the curve but if you do a full analysis and you look at your life and you're not going to run out of money but

yet you're still living this miserly life where you're not making memories. You're not doing anything. Use this as a wakeup call. I tell you, one of our favorite things, you know, we in our day jobs, we get to be fee-only financial advisors, and people always think that what a financial advisor does is tell you, uh, save more money, save more money, invest more, invest more. And while that's part of it, I would argue one of our favorite things in the world to do is when a client does get to financial independence, we get to be that voice of reason. Say, hey, it's okay. Yes, you can buy the new car. Yes, you can go on the trip. Yes, you can do the home renovation. Yes, you can fill in the blank. You'd be amazed at how many times it is such a struggle to tell a client, hey, how about we just turn on an automatic paycheck for you where every month you have an extra $500, an extra $1000 to hit your account. Let's just try it on for size.

and see how it works. Just like saving was a skill that you had to get better at, consumption is also a skill that some people actually have to learn. And you've spent your entire life, your entire career being a saver, saver, saver, saver, saver. At some point, you're going to want to figure out how do I get to enjoy the fruits of all that hard work that I did. 'Cause unfortunately, if you don't spend it, the statistics show you already said them second and third generation GNA have no problem doing it. Yeah, I that's what I I like to say we're spending coaches. I think it's the perception is your adviser is going to say no, no, no to everything. In reality, it's one of my favorite parts of my job is I love helping people live their best life in retirement. So what can you do know where you are and know where you're going the only way to know that if you've reached the financial Independence Point the only way to know

that you are at that abundance stage is to really understand, okay, where am I? Do I have enough that's going to provide for me for the rest of my life, given the unknown unknowns? Have I stress-tested? Have I gone through the work necessary to know? If you've not done that yet, you can't say, I'm at that place. But if you have done it, that's when you should probably start to think through adjusting your behavior. I love that you just said stress test the plan because look, there's nothing wrong with using the 4% rule, even our know your number. Those are great planning tools, especially while you're in the beginning stages, where you are trying to figure out your he the curve, behind the curve, or right on the curve. But once you actually have to start living off this money, you don't want a napkin financial plan. You actually want to know, Hey, is this okay? Because I might be walking away from a really great income, and once I cross this threshold, I can't exactly get back. And there's a chance I've only

done one retirement. I'd like to get somebody who's done this maybe hundreds, if not thousands of times as a firm so I have some experience, and I know what I'm getting myself into. Don't skip the step of maybe going beyond the napkin plan and actually doing a full financial plan or a stress test. This is a great time to maybe take the relationship to the next level. Now, as a cautionary tale, um, one thing that we see all the time, and we would caution you against, is don't get out ahead of your skis. And this is what we mean by that. We see so many times somebody who will be in their late 20s, early 30s, mid-Thursday, hey guys, I've done the math, I've been saving diligently, I'm going to continue saving for the next 30 years, and on paper, my spreadsheet tells me that when I get to retirement, I'm going to have $30 million, and I'm never going to spend that. So, I feel like I'm at Financial

Independence on paper, it sounds pretty good and it looks pretty good, but you're not there yet, so be careful ful arriving at the conclusion that all the hard work has been done when you act haven't actually done the hard work yet. There's nothing wrong with having a projection and moving along in your projection, but you need to be closer to the Finish Line The Starting Line before you begin changing Behavior. But also is what's on the net worst statement because it's one thing I mean you put two Rosy of assumptions. There's a lot of financial content out there that you can, whether it's goosing the return if you put 12% 15 % or if it's you make the safe withdrawal rate 8% or you know you see all kind of those things can make you feel way more comfortable, and that's fine maybe if you need some motivation if you're you're putting. But when it comes to actually having the money underneath you and on the net worth statement, you've got to be somewhat

conservative because once again you're going through a threshold of change that you can't. You got to measure twice, cut once because you can't get the water back up the hill. So you want to make sure you're on Solid Ground, not off some Rosy projection that may or may not work out. Now, if you want some help, you're okay. Am I on track or do I know if I'm moving through the correct uh, the correct Milestones that I want to be moving through? We actually just did a show titled Are you on track to becoming a multi-millionaire? This is where we lay out a number of financial milestones. So if you want to know where you are and are you hitting these milestones, we would encourage you to go check that out and that will let you know am I doing the things that I'm supposed to be doing am out ahead of my skis or have I actually hit the markers that I'm supposed to be hitting along my financial Journey go check that out if you've not had a

Sign #4 That You’re Saving Too Much for Retirement!

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Saving too much can be indicated by surpassing your financial goals and being unable to switch to spending.

It's important to find a balance between saving and enjoying life, even after reaching financial independence.

Financial advisors often find it challenging to persuade clients to start spending after they have achieved financial stability.

The Importance of Learning to Spend in Retirement

After a lifetime of saving, it's important to learn how to enjoy the fruits of your labor in retirement, as statistics show that later generations have no problem with spending.

A financial adviser can help you live your best life in retirement by guiding you to the financial independence point and stress-testing your plan for the unknowns.

While initial planning tools are helpful, once you reach the stage of living off your retirement money, it's crucial to have a solid financial plan in place.

It's important to seek experienced help for retirement planning and consider a full financial plan or stress test, rather than just a basic calculation.

Caution is advised against overestimating future wealth and financial independence, as well as being wary of overly optimistic financial projections.

It's crucial to have a realistic understanding of your financial situation and not rely on overly optimistic assumptions.

Importance of Financial Milestones for Long-Term Success

It's crucial to be conservative and measure twice when approaching financial milestones to ensure a solid foundation.

A recent show titled "Are you on track to becoming a multi-millionaire?" lays out the important financial milestones for tracking progress.

It's essential to assess whether you're on the right path and hitting the necessary markers in your financial journey.