Every year, I sit with people who did everything “right.” They saved consistently and reached the number they had been working toward, and they still feel worried once retirement actually arrives.
Some anxiety is unavoidable in a shift this big. Over time, though, I have come to think there is often something else underneath it. Withdrawal rates, asset allocation, and Social Security timing all deserve attention, and they rest on a simpler question that tends to get lost in the race to save:
What do you want to do with your money?
When that question goes unanswered, a number has nothing to be measured against. It can keep growing and still never feel like enough, because the exact definition of “enough” was never decided upon.
Why a Number Alone Won’t Feel Like Enough
Psychologists have a name for part of this: the hedonic treadmill. We adapt quickly to new circumstances, our expectations reset upward, and what once felt like abundance begins to feel ordinary. Someone saves diligently for decades, reaches a number they once thought would feel like security, and finds that the feeling of safety did not arrive along with it.
Learn What Makes Spending Money in Retirement Satisfying
Elizabeth Dunn’s research helped me understand what to do about that. Dunn is a psychology professor at the University of British Columbia who has spent much of her career studying how people spend money and what it does for their wellbeing. I saw her present her work at a conference in 2018, and her findings match what I have seen in conversations with clients over the years.
Here are five of her findings that I return to often. I will refer back to each one in a moment.
- Experiences outlast things. The pleasure from a new purchase fades quickly, while the memory of a meaningful trip or a shared meal holds its value and sometimes grows.
- Anticipation adds value. Paying in advance and then waiting helps, because the anticipation arrives after the payment instead of competing with it.
- Novelty matters. The coffee that feels like a treat when it is occasional becomes routine when it is daily, and routine does not carry the same lift.
- Giving to others lasts. It produces some of the most durable wellbeing effects of any spending category Dunn has studied.
- Buying time raises happiness. Paying someone else to handle a task you dread reliably increases happiness, often more than people expect before they try it.
None of this is a formula for how to spend your money. Dunn’s work describes what tends to hold true for many people, but it cannot tell you what will matter to you.
Notice Where Your Spending is Drifting
Without a guiding principle, the average person’s spending tends to drift toward whatever is available and easy. I notice this often in the early years of retirement, especially among people who spent decades as careful, disciplined savers. Dining out becomes more frequent, subscriptions multiply, and expenses that were once luxuries become the new baseline.
Anyone who spent decades building toward financial independence has earned the right to spend more freely. The question I find helpful is whether a given expense is something you would choose if you were being thoughtful about it, or if it is simply something that is easy. That is hard to answer without a standard for what “thoughtful” means, and the standard has to be yours.
What Does an Ordinary Tuesday Look Like for You?
Rather than asking people what they want out of retirement, which tends to produce gentle, vague answers like “travel more” or “spend time with family,” I try to find the specifics. What does an ordinary Tuesday look like for you? Skip the vacation version and describe the everyday one. What are you doing in the morning, who are you with, and what are you looking forward to?
The answers tend to be more concrete than people expect: coffee on the porch with a spouse before the day starts, dinner with friends once a month, a long weekend trip every quarter, time in the garden, lunch with a grandchild once a month (your treat), and a standing call with a grandchild on Sundays.
Look at how that list lines up with Dunn’s research. The monthly dinner is an experience with a date on the calendar, and the quarterly trip has anticipation built in. The daily coffee may hold its lift as well, because it comes with a person and a place attached.
Treating a grandchild to lunch is a form of giving, which has some of the most durable effects of any spending category in Dunn’s research. And if a task you dread keeps crowding out the porch or the garden, paying someone else to handle it may be worth considering.
Spend (and Don’t Spend) Confidently in Retirement
A list like this gives you something to hold each expense up against. When you know what you are spending toward, it becomes easier to spend with confidence on what matters and to let go of what does not. That works in both directions, whether your spending has been held back out of worry or has drifted toward convenience.
It also speaks to the worry we started with. When your money has somewhere to go, the number has a purpose, and a number with a purpose is far easier to trust.
The financial mechanics remain important, and I am not suggesting otherwise. When to claim Social Security, how to structure withdrawals, and how to think about sequence of returns risk all deserve real attention.
In the end, the clients I see feeling most settled in retirement are the ones who took the time to picture what they wanted it to look like and built their plan around that picture. When you know what your money is for, that tends to be more of a stabilizing force than any single financial decision ever could.
