Turn Up the Dial: How to Actually Enjoy Spending in Retirement
I spend a lot of time telling people to automate their savings, keep costs low, invest in index funds, and stay the course. But do you know what might be even harder than saving?
Spending.
I see this all the time with retirees. The math says they can safely spend $120,000 a year, yet their current spending sits around $60,000. They know they are fine. They see the charts. They trust the projections. Yet the idea of doubling their lifestyle makes them deeply uncomfortable.
I get it. If you have spent the past thirty or forty years living below your means, flipping the switch from saver to spender can be incredibly difficult. It feels risky. It feels unfamiliar.
Besides, it’s not like you’re suddenly going to double your lifestyle overnight. To go from Best Western to butler service at the Four Seasons would require you to become a completely different person. That doesn’t happen on Day 1 of retirement.
But here is the thing. You saved all your life for this moment. If you cannot bring yourself to spend your money, someone else will. Your beneficiaries. The government. And that money might arrive at an inopportune time for your kids (they may already be retired and financially secure), or for your estate when the government takes a giant bite out of your still-too-large RRIF account.
So how do you give yourself the permission and the confidence to spend (or give) more now, while you can truly enjoy it?
The Money Dial Approach
A concept I like is called money dials. These are categories of spending that bring you the most joy. Travel, home comfort, fitness, dining out, convenience, generosity. Everyone has a different mix.
Any retiree can turn up one or two of those dials and significantly increase their happiness without feeling wasteful.
Related: Why we stopped saving so much and started living
Start with travel. Many retirees rank that dial at the top:
- If you normally stay at a budget hotel, try a classy boutique or a luxury resort. You might love it. And if it’s not your thing, now you know.
- If you always fly in the cheapest economy seat, try premium economy or business class for comfort.
- If you usually go for one week, extend it to three. If you take two trips a year, make it four.
And consider combining joy with generosity. Rent a beach house or villa large enough for your adult kids and grandkids to join. They get a holiday they may not be able to afford. You get the family time. It’s okay if it feels like a forced family reunion. You paid for it.
The Research Says You Are Underspending
Morningstar researcher David Blanchett studied how spending actually changes throughout retirement. His work shows that inflation-adjusted spending typically declines for the first 10 to 20 years before rising again much later in life due to healthcare costs (keep in mind this is American research). It creates what he calls a retirement spending smile.
In plain language: most retirees spend less than they could, exactly when they are healthiest and able to enjoy their money the most.
Behavioural economists point to identity as a major factor. You have viewed yourself as a saver for decades. Spending more feels wrong, even when the spreadsheets prove it is safe. This saver mindset is powerful, and it takes intentional behaviour changes to loosen its grip.
Spend Joyfully and With Purpose
There are many high impact ways to increase spending while improving your life and the lives of others:
- Help your kids build wealth early. Fully fund a First Home Savings Account (FHSA) for them ($8,000 per year x 5 years). Help with TFSA contributions. A gift of $10,000, $25,000, or $100,000 for a down payment can be life changing at their age and stage of life.
- Support your grandchildren. Fund $2,500 per year into their RESPs. Take that burden off your kids’ shoulders.
- Level up your giving. Increase that favourite charitable donation from $100 to $1,000 or more (turn up the dial). Create a scholarship fund at your local college or university. A $50,000 gift creates a $2,000 annual scholarship in perpetuity. Talk about leaving a legacy.
- Become the 100% tipper for local baristas and servers.
Pro tip for charitable giving: If you donate appreciated investments from a taxable account directly to charity, you avoid capital gains tax entirely and receive a donation tax credit for the full value. The charity gets more. The CRA gets less. You feel great.
Three Ways to Turn Up the Joy Dial
- Upgrade one thing. Take something you already enjoy and increase the quality.
- Spend to create memories. Bring family or friends along for the ride.
- Give while you live. Generosity offers more joy when you can see the impact.
Let Your Imagination Spend a Little
I have had clients purchase a sailboat and learn to navigate across the ocean. Others bought an Airstream trailer and hit the road for months at a time. One couple now spends every winter living steps from the beach in Mexico. The money was always there. They just needed someone to show them it was okay to enjoy it.
Your only limit is your imagination.
The Bottom Line
Retirement should not feel like a financial waiting room where the goal is to die with the largest account balance. You have permission to spend more. You earned that permission through a lifetime of smart decisions.
Turn up one dial. Try it for a year. If you do not like it, turn it back down and try something else.
But do not wait until it is too late.
You can afford to enjoy the ride.
Excellent article and some good ideas on how to change their habit. Planning and have taken three special vacations a year. I haven’t switched from economy seats but will gladly pay extra to get the seats with more leg room. Always get out for a good quality coffee and am happy to pay extra and leave a generous tip, and avoid Tim Hortons like the plague.
That’s great to hear – thanks for sharing!
This sounds exactly like the book Die with Zero but significantly abbreviated. All excellent points and advice!!
Thanks! I firmly believe most non-fiction books could just be condensed into a blog post 😉
Business class the only way to fly!! BUT I still look for a lower price doo bit. Why spend $6k when I can get it for $2.5 k but my journey takes 4 hours more than the $6k. . I’m retired I’m not in a hurry!!
Definitely need to find the sweet spot. We’ve booked premium economy from Calgary to Edinburgh a few times for good value. We also found business class to Puerto Vallarta for cheaper than premium economy.
Thank you again for the reminder to spend more in retirement! It sounds so easy but can be difficult! Love your suggestions so practical and rewarding. We only have so many go go years so Yes spend the $$$ as best you can .
Very true, Paulette – tomorrow is never promised, and while that’s not an excuse to throw all caution to the wind and spend beyond your means, many of these ideas won’t break the bank and can add tremendous joy to your life.
How complicated or difficult is it to donate to charity directly from a non-taxable account? I had never heard of this but would love to take advantage of this opportunity, assuming it doesn’t involve jumping through a vast array of hoops etc.
Hi Jeff, it certainly depends on the size of the charity. Here’s a playbook:
Pick the recipient and confirm they take securities.
Ask the charity if they accept in-kind gifts of publicly traded securities (stocks, ETFs, mutual funds).
If they don’t, use an intermediary that does (e.g., CanadaHelps, many community foundations, Donor Advised Funds). CanadaHelps’ process is literally “pledge → send broker letter → broker transfers.
Choose which shares to give (from your taxable account)
Select securities with gains. When you donate eligible publicly traded securities in-kind, the capital-gain inclusion rate is 0% – you don’t pay tax on that accrued gain.
Get the transfer details.
The charity (or intermediary) provides a one-page “Letter of Direction/Authorization” with their broker name, account number, and routing codes (CUID/DTC/FIN). You fill in the ticker/CUSIP and share/units to transfer in kind (do not sell first).
Submit the form to your brokerage
Send the signed Letter of Direction to your broker (Questrade/Qtrade/RBC DI, etc.). They push the shares to the charity’s brokerage account. Intermediaries provide institution-specific instructions if you’re self-directed.
Wait for settlement and the receipt.
Once the charity’s broker receives the shares, the charity issues an official donation receipt for the fair market value on the date they receive them (not the day you send them). CRA lists what must appear on that receipt.
Claim your tax credit.
You claim the donation on your return (Schedule 9 / line 34900). If you give more than you need this year, unused amounts can be carried forward up to 5 years.
Pro tips & common gotchas:
Timing: year-end gifting can bottleneck at brokers and charities; initiate well before late December so the receipt date lands in the year you want. (Intermediaries also note extra steps for self-directed accounts.)
Loss positions: if a holding is down, it’s usually better to sell, realize the capital loss, and donate the cash (you keep the loss for tax purposes). If you want the security back, avoid the superficial-loss window when repurchasing.
Registered accounts: don’t donate from RRSP/RRIF/TFSA. Pulling from an RRSP/RRIF is taxable to you, and TFSA withdrawals already aren’t taxed – better to give cash from those if desired.
Receipts: CRA tells charities exactly what must be on your receipt; keep it with your records.
Through a corporation: If your company donates publicly traded securities in-kind, the capital gain is also tax-free and the gain amount typically credits the Capital Dividend Account (CDA), enabling a tax-free capital dividend to shareholders – nice extra planning lever. (Confirm with your accountant.)
Using an intermediary: Charities that don’t have a brokerage can still receive securities via platforms (e.g., CanadaHelps). Expect a small admin fee, detailed on their sites.
Hey Robb,
I can’t possibly imagine a more detailed or speedy reply. Very impressive. And bonus points for getting back to me on this just as the Blue Jays were taking to the field in the World Series 😉
Can’t thank you enough for the thorough reply and also for being kind enough to ignore my ‘non-taxable’ typo too 😉
Absolute rockstar. Have yourself a fabulous weekend, Robb.
I’ve heard you talk about this before and I have to admit the concept of underspending is so foreign to me!
I live within my means now but I love to treat myself!
Do spending habits change the other way in retirement? e.g. Do some of your clients spend more in their high income working years and less in their retirement 60s and 70s?
Thanks Robb. Great article (as usual!) As at least one other person has noted, it somewhat echoes Die with Zero. No bad thing as far as I’m concerned. But I like your particular take on the topic and the many creative – but also workable – ideas you’ve put forward. Most of all, I like the advice you’ve offered on how to do it – i.e. how to take those first steps away from the “always be saving” mindset. As a behavioural shift it’s massive. 14 years into an enjoyable and comfortable retirement, and I still find it strange at times to be spending and not saving. A problem I’m happy to keep working on 😉