Weekend Reading: 3 Steps to Beat FORO (Fear of Running Out)
This article appears as part of Casey Weade's Weekend Reading for Retirees series. Every Friday, Casey highlights four hand-picked articles on trending retirement topics and delivers them straight to your email inbox. Get on the list here.
Decades of frugality and saving throughout your working years isn’t an easy mindset shift when you go from accumulation to decumlation mode. If you continually experience the fear of running out of money (FORO), it can create a significant impact on your lifestyle during retirement. You might be prone to reduced spending, limited experiences and increased stress.
READ THE ARTICLESo how do you overcome the anxiety? Author Mark Colgan suggests three steps:
📌 Redefine your relationship with money: View money as a tool, not a measure of happiness. Focus on the benefits of spending and align those with your values and goals.
📌 Calculate your "sustainable withdrawal rate:" Consult a financial professional to determine a sustainable withdrawal rate from savings and investments based on your individual circumstances.
📌 Prioritize your spending: Create a "conscious cash flow plan" by identifying wants and needs and allocating funds accordingly. Reevaluate your spending habits to focus on experiences that enrich your life and create lasting memories.
Didn’t you save the money so you could enjoy it? When you shift your mindset and find a healthy balance between saving and spending, you can spend your retirement focused more on what matters most to you.