Many couples report that the “empty nest” years are some of the best of their lives, both personally and financially. As children grow up and leave home, parents find themselves suddenly free to travel, pursue leisure activities, and spend more money on themselves than ever before.
The savings of these years can really add up. Suddenly there’s no more private school tuition, children on your auto insurance policy, or stockpiles of groceries to purchase for ravenous teenagers. Having such a surplus in your budget can be very tempting, and you should indeed enjoy some of the fruits of your labor. After all, raising children is some of the hardest work in the world; you should enjoy your newfound freedom!
The danger, of course, is that you could set yourself up to enjoy a lifestyle that is not sustainable in retirement. While it’s important to have a little fun now, you don’t want to set yourself up for disappointment when you stop working in a few years. You also don’t want to spend money that could have been used to pay down debt, and then find yourself wading through credit card bills in your golden years.
The best strategy at this time is to meet with a licensed, reputable financial advisor, who can help you decide how to best invest some of that extra income. The good news is that these years are likely to bring your highest earning potential, so you can probably stash quite a bit of money for retirement without creating an overly restrictive budget for yourself. Your advisor can help you determine your priorities, and then develop a plan to help you meet your goals. You could find yourself entering retirement without loads of debt, and able to smoothly transition into a lifestyle that is very much like the one you’ve been enjoying.