Retirement Surprises – It’s the Little Things

Key Takeaways

  • When we plan our yearly spending, it doesn’t always work out the way we want it to because of the little things that inevitably come up throughout the year.
  • Adding 10% to your overall spending plan for the year helps mitigate the surprise expenditures.
  • Having a 10% spending buffer sets good expectations and gives you peace of mind when the little things come up.

There’s a travel axiom you may have heard, where you lay out all your clothes for a trip and you plan on an amount of money that you think you’re going to spend. Then, pack half those clothes and double the money you plan on spending! That’s the way it seems to work when we plan for our travels.

Likewise, when you are looking at spending for the next year, it never seems to work out the way it should, so I am going to give you an axiom that can help you in your yearly expenditure planning.

When we talk about yearly spending, it’s the little things. What do I mean by that? Things like unexpected home repairs, dental expenses, unreimbursed medical expenses, helping family members with money emergencies, and so forth. Every year there’s something, and these little things can add up.

So, here’s how I’d like you to look at it:

  • Look at what you believe you are going to spend in the next year.
  • Be sure to include one-time expenditures. Maybe you have to replace your roof this year, or buy a new car, anything you know you have to purchase this year.
  • Include any vacations or travel plans for the year as well.

After looking at these items and coming up with your overall spending number for the year, add 10%. That’s the axiom: whatever you plan on spending for the year, add 10%.

What does this do for you? First, it sets good expectations. Life is about setting expectations, so if you set this add 10% expectation, it’s highly unlikely that you will spend beyond that. Second, it gives you peace of mind. You are going to feel comfortable throughout the year knowing that when little things come up, you’ve got money to cover them. You aren’t going to get irritated or frustrated trying to reduce your spending to cover these expenses.

Let’s be sure to address these little things that we know come up every year, be honest with it, and go with the add 10% axiom. It’ll set you up for success and keep your spending plan on track for the year.

Until next time, enjoy.


Learn more about TransformingWealth™ , our proprietary approach, designed to get your arms around the big picture so you can make informed financial decisions. Ask Gary about Coyle’s TransformingWealth Preview Meeting, and schedule a complimentary consultation and start living the Good Life Managed Well™.

Gary Klaben is in our Glenview, IL office and serves our clients who are now located all over the country.  He has over 30 years of experience and is the author of Changing the Conversation, The Wealth Sanctuary and co-author of The Business BattlefieldWhether advising his clients, mentoring his team, or coaching entrepreneurs, he is always simplifying complexity and motivating others to take the next action that’s right for them.
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