Is it possible to spend too little in retirement?
“Be frugal.” “Save for the future.” “Live on less than you make.” All good advice, particularly since most of us don't follow it.
Being frugal is the common denominator of almost every first-generation wealth builder. But don’t confuse living on less than you make with underspending, warns financial planner Rick Kahler.
What’s wrong with someone living on less than they could? Is it bad to continue to be thrifty? Of course not. But frugality can be taken to extremes, particularly for older people who have trouble putting aside the habits of a lifetime, he says.
But too often underspending results in older people failing to get adequate medical care, eat a healthy diet, live in a well-maintained and comfortable home, or use help and support that would make life easier.
"The cure to underspending is not running out and spending money frivolously or indulgently on things or experiences that don’t really add value to your life. Instead, it’s using what you have to make your life more comfortable and enjoyable," Kahler suggests.
Of course, you could always think about making someone else's life more comfortable and enjoyable as well.
Do you know someone who is just too frugal for their own good? Or do you yourself have trouble spending after a lifetime of scrimping?
By Gordon Powers, MSN Money