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Should You Spend Your Nest Egg or Leave a Legacy?

Millions of Americans take strides each year of their working life to set aside money for retirement. Through shrewd investments and smart planning, many of them can set aside enough to live on for two or more decades of retirement. It is possible for savvy investors and smart savers to end up with a nest egg that is larger than what they are likely to spend in retirement. This leaves them with a conundrum of sorts. Is it best to spend that nest egg and enjoy a comfortable, perhaps even lavish, retirement? Or, should you consider using some of that money to leave a legacy? If you're not sure how to proceed, these steps will help.

 

Start with Your Own Bills

Before you can consider your legacy, it is important to make sure that your nest egg has the bulk to both support your retirement comfortably and leave behind a legacy for the future. US News points out that the best place to start is reviewing your own bills. If you know how much your living expenses and other costs, seen and unforeseen, might drain your nest egg over time you'll be able to determine your ability to establish a legacy. When looking at possible unforeseen expenses, try to calculate the cost of major medical events or changes in health that require a change in residence. For example, deteriorating health leading to assisted living or nursing home care. This can drastically alter your expenses in retirement.

 

Look at Your Financial Plan

Now that you've investigated your own expenses for the future, you can develop a financial plan that meets those costs. Those who opt to "wing it" during retirement with a financial plan tend to outlive their savings. In most cases, these individuals either didn't save enough money or failed to accurately forecast their future expenses. In some cases, both things occur and leave people in dire financial straits. Therefore, it's important to not only establish a financial plan, but also to update it over the course of time as you near retirement to ensure it is capable of helping you meet your goals.

Consider setting aside a certain amount of money each month and having it allocated on a particular day. This way you'll know how much you've got access to and when. You'll be able to better plan and stick to your budget.

 

Consider What a Legacy Means to You

If you find yourself with more money than you need in retirement and want to spend it on others, you should take the time to consider what a legacy means to you personally. One person's legacy is not suitable for everyone else. A legacy should hold personal meaning to you. If you have children and always wanted to provide for them and their children, your legacy could be college funds for all of the grandchildren. If you don't have grandchildren or never had children, your legacy could come through supporting social and environmental causes. There's no such thing as the wrong legacy as long as it means something to you individually.

Contact Hughes Warren today for more information on leaving your legacy.

 

 

 

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