Are you getting the balancing act right?

[BreezyClouds]

Assuming you have enough spare to save/invest, do you feel you are getting the balance of enjoying today versus saving for the future right?

We earn well and live comfortably, even throw money at problems when useful. But we don't have nice cars or expensive holidays or a big house. We don't value those things. We don't go out much either, partly because we don't value it and partly commitments.

We spend quite a lot on food, hobbies and theatre, and save maybe 3k a month. Savings are for disabled DC to hopefully keep them out of poverty when we're gone, and for earlier retirement.

We're doing quite well, it's at the point where it's really starting to snowball and sometimes our shares make more in a month than we do (then often fall again!). Starting to think we 'should' spend more, I think there are plenty of things we would value but can't really define them.

Would love to hear about how others balance this? Do you have lots of wants and pick those you can justify, or is it more realising you're ahead of plan and looking for somewhere to spend more?

I save / invest about 60% of my income every month. DH does likewise. We definitely pick what we splurge on. I love beautiful clothes and books. He enjoys rare books and good furniture. We both like a far-flung holiday and regular theatre trips / museum subscriptions / charity and local community donations.

However I take my lunch and snacks in to work every day, have a cheap gym subscription and switch/negotiate downwards on every bill going. We live in central London so no need for a car. No children by choice.

We are both in our early 40s and planning to semi-retire at 60 (we are already NED-ing alongside full-time City roles to enable this). We definitely feel like we are living a lovely and very comfortable life. We could justify spending more but don't see the need.

I don't think I really get the balance right. I bought this place after getting divorced and whenever I've had a payrise since, I have used the extra to save or overpayment the mortgage. I'm now mortgage free and just rebuilding savings. A little bit in a S&S ISA and adding more to my pension now.
I definitely treat myself more than I used to but tbh I found that I was getting really jaded with working harder, in a more senior role, with more stress and still living on the salary I had years ago. So a few more holidays (cheap short breaks usually) and more nights out (live music, meals, etc).
It's hard trying to balance the need to save/invest more (my pension is too low, uni costs for kids are a killer) and actually feeling it's worthwhile working.

That does sound like a good balance. When you say semi-retire will that be reduce days in current role or go and do something else on fewer hours?

I have a vague plan to do something interesting and more worthy but it won't bring much in so I'll need to be able to afford to retire first.

Do you feel you've been risk averse? It's hard if you're on your own, paying off mortgage is very sensible and you'll be glad of it if your earning years are cut short but maybe regret it if all goes well and you could have got better returns elsewhere.

How will things be once DC have graduated? You might have plenty to fill your pension then.

Definitely risk averse. I think part of it is feeling like nothing improves. I think that the state pension will be very different by the time I retire so I don't think things will be easy then either. I think it's a combination of not really knowing what I'd do differently that makes me question it.

@BreezyClouds it would mean finishing our exec careers and moving to a portfolio career (non-exec directorships, one or so remunerated, perhaps a charity board etc.) of ca 1-2 days a week.

Currently we are both on boards alongside our full-time roles, but we would give up that full-time role entirely.

We both love the fields we are in, so at this stage don't really ever want to give it up entirely (of course this may change!). And boards are a good way of keeping one's hand in.

Have you had a look at whether you and DH could do something remunerated, board-wise, as a glidepath into retirement? May enable you to feel more comfortable about splurging a bit more now if so.

I feel we are. DH has moved to a 3 day week, I work 30 hours per week. We have a second home we go to most Friday afternoons, back Sunday nights. We enjoy life and socialising and travel.
We are well on track for comfortable retirement in a few years time. Kids are set up with investments and property and are progressing in their own lives.

We've set a budget every year for the last 25 years. So we are pretty clued up on our spending needs and wants. We have always assigned a priority to the now in balance with the future through our budgeting. We met our pension goals three years ago which was set for a very comfortable retirement. We've also analysed the long term numbers in a very pessimistic way, taking into account several years for both of us in a care home and still there's plenty left over for the dc's inheritance.

Dh is planning to work for a another three years full time - after that I expect he'll taper off his work commitments - he works because he enjoys it but it's not the only thing he enjoys.

I can confidently say there's a lot more in the pot than we'll ever need.
Our budgeting has allowed us to get to this point but we've always believed in obtaining a balance - we never believed in living in misery to pay our mortgage off. At times we've had to sacrifice the now for the future - but it was always on a very short term basis.

Of course you prioritise the things you like - there's no point in doing otherwise and it doesn't matter how much money you have, what you don't have is an infinite amount of time, so use your time wisely and don't spend it eating in restaurants if that's not what you love to do - what would be the point of that?

Finally one of my friends is very wealthy - she retired at 55 as did her dh, she intends to spend every penny, leaving none to her son (I don't think this will be possible). She can't enjoy her money, she counts every bloody penny - she says she enjoys the challenge of sticking to a very tight budget and it's how she spends a great deal of her time, squeezing every last penny out of her fortune. Fair enough for her - we're all different but I don't enjoy listening to her going on about it - if she was skint that would be fine, but since she has retired she's become obsessed - when being miserly is your main passion in life - the balance is very badly wrong, imo.