Should the amount you are saving for retirement impact your current quality of life?  

I currently save 31% of my income and have about $500,000 in various retirement accounts (Roth, 403(b) and a few other accounts). I feel like I am living paycheck-to-paycheck because of the amount I am saving every month, and I have a hard time spending money. I am 35 years old. Should the amount you are saving for retirement impact your current quality of life?  

Personal Finance, Retirement
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January 2018

Panambur, Deva

New York, NY
72% of people found this answer helpful

It is great that you are saving for retirement and thinking through all these questions. A good financial plan should be balanced between living for the moment and planning for the future. Your plan should be efficient, effective and with limited downside risk (ie good risk management built in using tools like insurance etc). However, like an extreme weight loss program that is hard to maintain, if your savings and retirement plan is causing a lot of discomfort today, then your motivation to maintain the plan may dwindle over time. If you are worried and want clarity, you should make a formal plan considering expected inflation, expected rate of return on investments, expected age of retirement, expected expenses etc. Since you are relatively young this exercise will be imperfect as you have to forecast a long time into the future and you may also have several life changes between now and retirement-but it may help give you some guidance on how much to save. There are several calculators you can use such as

Ask yourself how much more you need to spend to live comfortably- see how that impacts your plan in the calculator above. That could put things into perspective and could also motivate you to look for other sources of income to make up that difference.

All the best.

January 2018
January 2018
January 2018