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Are You Spending Too Little in Retirement?
By Martin Cloutier, CFP®, CIM® – August 25, 2026
The $700,000 Retirement Mistake: Are You Underspending?
Most retirement planning focuses on one question: Will my money last?
But there is another question that can be just as important:
Are you actually using enough of your money to enjoy the retirement you worked for?
A recent retirement planning scenario shows why this matters.
A Retirement Plan That Worked — But Left Money on the Table
The plan involved a woman in her 70s who owns her home, lives modestly, and does not have children she plans to leave her estate to.
At age 75, her current retirement plan projected approximately $44,000 in annual cash inflow and about $32,000 in expenses, leaving around $12,000 in surplus cash flow each year.
Technically, the plan worked. She was not projected to run out of money.
But the question became: Could her existing wealth support a better retirement lifestyle?
One Scenario Created About $700,000 More Cash Flow
An alternative scenario looked at what could happen if she sold her condo, invested the proceeds, rented in the same neighbourhood, and intentionally used more of her home equity during retirement.
This does not mean selling your home is right for everyone. The goal was simply to understand what other possibilities existed.
Under the alternative scenario, her annual surplus at age 75 increased from about $12,000 to more than $57,000.
From 2026 through age 90, her current plan produced approximately $250,000 in total surplus cash flow, compared with almost $950,000 under the alternative scenario.
That is roughly $700,000 in additional cash flow available during retirement.
Retirement Planning Is About More Than Leaving Money Behind
Extra retirement cash flow could mean more travel, better accommodations, restaurants, entertainment, helping family while you are alive, or simply having more freedom to enjoy everyday life.
At the same time, the original plan could potentially leave an estate of around $1 million or more.
There is nothing wrong with leaving a large estate. The important question is whether that outcome is intentional.
Your retirement plan should help you decide how much you want to preserve, how much you need for emergencies, how much you want to leave behind, and how much you can reasonably use to improve your lifestyle today.
Balance the Financial and Happiness Scoreboards
A successful retirement plan needs both.
The financial scoreboard asks whether your assets, income, taxes, and risks are properly managed.
The happiness scoreboard asks whether you are actually enjoying the life your savings can support.
Sometimes the biggest retirement mistake is not overspending.
It is spending too little for too long and realizing later that you could have afforded a very different retirement.
A good retirement plan should not only help your money last. It should help your money support the life you actually want to live.
Watch the full video to learn more!
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Disclaimers: Any view or opinion expressed in this article are solely those of the Representative and do not necessarily represent those of Harbourfront Wealth Management Inc. The information contained herein was obtained from sources believed to be reliable, however accuracy is not guaranteed. The information transmitted is intended to provide general guidance on matters of interest for the personal use of the viewer, who accepts full responsibility for its use, and is not to be considered a definitive analysis of the law or factual situations of any individual or entity. Any asset classes featured in this presentation are for illustration purposes only and should not be viewed as a solicitation to buy or sell. Past performance does not necessarily predict future performance, and each asset class has its own risks. As such, this content should not be used as a substitute for consultation with a professional tax or legal expert, or professional advisors. Prior to making any decision or taking any action, you should consult with a licensed professional advisor.
Harbourfront Wealth Management Inc is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization .
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