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    How Much Money Is Enough for You?

    By Brandon Miller, CFP–

    Mercifully, 2020 has ended. Sadly, our lives continue to be upended. It’s hard not to shout, “Enough already.” We long to hug our friends. We crave a night on the town. We’re desperate for some live entertainment. Shoot, we just want to see people’s smiles again.

    But there are still months to go before this strange saga ends. So, even though we say we’ve had enough, we know we’ll go on.

    And that’s the problem with enough. It isn’t a finite concept or amount. Really, how much is enough?

    I ask this because it’s a difficult question that everyone faces when it comes to money. It’s particularly relevant these days when so many are questioning if their “free time versus more money” balance needs to be recalibrated. Putting in more hours to get ahead may not be as appealing as it once was, whereas spending time with loved ones or traveling to exotic lands might be more enticing than ever.

    How then do you go about determining how much money is “enough” for what you want to do? Start by realizing that there are two sides to this proverbial coin. One is financial and the other emotional. Let’s tackle the financial side first since that’s the easiest.

    There are plenty of retirement calculators and software that can give you a predictive figure for how much you need to stop working. Fill in the fields and voila, a magic number appears. You can play around with different scenarios, such as what if you stopped working two years earlier or reduced your income by half. A few clicks can show the impact these actions might have on your savings, and therefore your lifestyle.

    But the sum you’re given leads to a trickier question: Is that amount enough? Obviously, if your tally is three million and you only have thirty thousand saved, it’s not enough. But what if you’ve already passed the savings threshold? That’s where the emotions come in.

    Maybe you question if you can really trust a figure you got from some free, online tool. Valid (though many of these calculators are quite good), but I get clients questioning whether my math is correct, too. Because it’s not really about the numbers. It’s about fear of the unknown and feelings of letting go. Much like your first plunge into a pool of water was a scary leap of faith, jumping into retirement requires both courage and belief.

    It’s far easier to let yourself be held back by “what ifs.” What if I need more money than I thought I did? What if I become ill and require long-term care? What if the bottom drops out of the stock market? What if my daughter moves back in with her two kids?

    To overcome these mental roadblocks, start with a reality check. How likely is your fear to happen? If you think there is a high probability, see what you can do to compensate. If you’re worried about healthcare expenses decimating your savings, for example, maybe you reduce your entertainment budget and use that money to buy long-term care insurance. You might also find that some tradeoffs are worth making, such as giving your daughter and grandkids a safe place to land rather than jetting off on world travels.

    In general, making more money means you have less time for yourself and for family, friends, and passions. Is that okay with you? Or would you rather forego that vacation house in Tahoe to retire two years earlier?

    For those who already have more than enough wealth socked away, why not spend the rest of your time enjoying your riches? Wouldn’t you prefer modernizing your kitchen or financing your grandkid’s college degree over dying with regrets and a pile of cash? Spend your money and enjoy it, even if that means giving it away.

    If 2020 taught us anything, it’s to prioritize what is most important in our all-too-short lives. Time will always be the most precious thing you possess. How you spend it defines your life. Why then not use a little of your time to put a concrete number on your dreams? It might help you view “enough already” in a whole new light.

    The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security. Brio does not provide tax or legal advice, and nothing contained in these materials should be taken as such. To determine which investments may be appropriate for you, consult your financial advisor prior to investing. As always please remember investing involves risk and possible loss of principal capital; please seek advice from a licensed professional.

    Brio Financial Group is a registered investment adviser. SEC Registration does not constitute an endorsement of Brio by the SEC nor does it indicate that Brio has attained a particular level of skill or ability. Advisory services are only offered to clients or prospective clients where Brio Financial Group and its representatives are properly licensed or exempt from licensure. No advice may be rendered by Brio Financial Group unless a client service agreement is in place.

    Brandon Miller, CFP®, is a financial consultant at Brio Financial Group in San Francisco, specializing in helping LGBT individuals and families plan and achieve their financial goals.

    Published on January 14, 2021