How do you know when you have “enough” money to retire?

June 10, 2022

Retirement is one of the most important chapters of your life and you’ve probably already thought about how you’d like to spend it. From relaxing on long foreign holidays to mastering your hobbies, there are a thousand ways to enjoy this time.

With that in mind, you might be wondering “how will I know when I have enough money to retire?”

This is obviously an important question, but it can also be a tricky one to answer since it largely depends on what you want from your retirement. If you’re asking yourself this question, read on to find out how to know when you have “enough”.

Retirement often means different things to different people

One of the most common concerns our clients have is whether they have enough to retire. However, it can also be a tricky one to answer since, at the end of the day, “enough” means something different to everyone.

For example, let’s define it at its most basic level – the amount of money you’d need to cover your basic needs and no more. While you’d have a full stomach and a roof over your head, you probably wouldn’t enjoy your retirement very much.

Alternatively, you could define it as being enough money to pay for your reasonable wants. This could realistically pay for a nice home, annual holidays, and private education for your children. With this, you’d be comfortable, but it probably wouldn’t let you live out your retirement dreams.

Finally, you could take it one step further and define “enough” as having all the money you’d need to pay for your desires. This would enable you to take long holidays wherever you want, easily help your children to buy their first home, and live out whatever exciting dreams you have.

While this might sound ideal, it raises another question: how much would you need to afford it?

That much luxury could be very expensive, so you’d need to devote a great deal of your working life to building up enough wealth. While you’re doing this, you wouldn’t have as much time to do the things that make you happy, such as enjoying your hobbies and spending time with your loved ones.

There’s often a fine balance between enjoying your wealth and building long-term security

When it comes to having “enough”, most people fall into one of three categories:

Too little

The first group consists of people who don’t yet have enough to achieve their long-term goals. Unless they make some significant changes to their financial situation, they probably won’t be able to enjoy the retirement they want.

This can be a serious problem, as not having enough can cause major financial and emotional difficulties for you and your loved ones. At a time when you should be relaxing after a lifetime of hard work, money worries are the last thing you need.

Too much

The second group are the opposite of the first, as they have more than enough to reach their long-term goals. You might be thinking this is a very enviable problem to have, but it’s rarely as ideal as you might think.

The problem that people in this category usually have is that they’re too concerned about whether they’ll have enough wealth to last throughout retirement. This can often mean they’re hesitant to spend their money on things that make them happy in the here and now.

Having too much money can also result in significant tax issues when you pass away.

Just right

The final group are the people who have enough money to reach their goals but may not realise it yet. Having a long-term financial plan can enable them to enjoy the rewards of their hard work without having to worry about running out of money.

Working with an adviser can help your retirement to be comfortable and sustainable

When thinking about your retirement, one of the biggest mistakes you can make is to see it as a purely financial question, rather than one of lifestyle. While it can be tempting to simply ask “how much is enough?”, the real question is “enough for what?”

If you want to build up enough wealth to reach your life goals, the first step is to have a clear picture of what you’re aiming for. This is where seeking professional advice can be invaluable.

Working with a financial planner can help you to find the right balance between financial security and living your desired lifestyle in retirement. This can give you greater peace of mind to know that you’ll be able to enjoy your retirement to the fullest.

Get in touch

If you want to be able to prepare for retirement with confidence, we can help. Email us at or fill in our online contact form to organise a meeting and we’ll get in touch.