I saved $3 million but was afraid to spend it when I retired. Here’s how I changed my mindset after being frugal for decades.

• During his 40-year career, Scott Scovell saved $3 million for his retirement.

• But when he retired, he was so stuck on saving that he struggled to start spending.

• Spending strategies, such as a $50,000 “war chest,” helped him adopt one carpe day approach.

I’ve spent a lifetime fretting and worrying about my retirement portfolio and savings, and in 2020 when I’m 58, they’re worth $3 million—more than enough to cover retirement and healthcare for the rest of my life.

Still, I was worried about worst-case scenarios such as hyperinflation leaving me penniless. So I worked for the next year. and another.

For decades, I heard retirement advice telling me to “save more!” But no one explained that at some point, I needed to radically change my lifestyle and “spend more!”

I insisted on saving until an old college classmate died in 2022 at the age of 59. I was about the same age, and her death deeply disturbed me. Realizing that I had more money than time, I decided it was time to stop working.

A few weeks later, one day before my 60th birthday, I quit my full-time job as head of pricing at a software company. I transitioned into the next phase of my life, but struggled to change my savings-oriented mindset.

I was proud of my disciplined approach to saving

I had been saving for retirement since the beginning of my career, when I worked as a junior portfolio analyst at a financial planning company. I chose to have my company deduct 10% from each of my paychecks and put it into a retirement fund. They partially matched my contributions, and drummed into me the importance of saving for retirement.

I continued this habit into my 20s and 30s. As I got older, I tried to contribute the maximum 401(k) allowed by the IRS, including the extra catch-up amount they allow after you turn 50. Fortunately, my career as a product and general manager in various industries, including banking, media, and technology, has given me the means to continually contribute to my plans.

Over nearly 40 years, I have put money away from almost every paycheck into retirement accounts, postponing today’s happiness to ensure tomorrow’s happiness.

To maximize long-term returns, I invested in each of my employer’s retirement plans in equity mutual funds, mainly aggressive US funds and some international ones as well. Each time I moved companies, I rolled my funds into low-cost Vanguard IRAs with my former employer. I didn’t care if the market went up or down, I knew that over the long term, stocks significantly outperformed cash or bonds.

By my late 50s, thanks to the power of compound interest, my savings had grown to $3 million. Also, I owned my house. My gut felt that I had enough money to retire, and I then confirmed it by reading investment articles, talking to experts and friends, and building a multi-page spreadsheet that broke down my finances.

I was financially but mentally ready to retire

At first, it was uncomfortable seeing my savings dwindling, and I had such a work-life balance that I couldn’t even think of myself as “retired.” I said I’m just taking three months off before I decide on the next step in my career.

I felt the need to reconnect my mind and approach personal finance to ease my transition into retirement and spend the way I like to save. It helped me quit working more willingly.

When my three month “vacation” was over, I made it a few months and then some more. I just started my 38^th Month of vacation. And now, when my taskmaster mind wanders, I even tell people I’m retired.

I give myself a ‘paycheck’ and a ‘war-chest’ for fun experiences

I budgeted that I would need $7,500 a month to cover expenses during retirement, which I initially manually transferred from my savings to my checking account. But then, my frugal instincts kicked in, and I wondered if I could get by with $6,500 by cutting back on things like eating out or buying clothes.

An automatic monthly transfer was a much better solution. I discovered this approach in a retirement article, but went further by naming it my “paycheck.” This language dampened my anger, and as a result, I never had to worry about how much I was holding back, nor was I tempted to cut back on anything.

Another effective anti-saving tool is my “war-chest,” a pot of money that I set aside each year for fun experiences, some of which is taken from my monthly “paycheck.”

I aim to pay $50,000 a year for this war-chest, so I can still be in my early 60s, physically fit, and travel extensively in the “go-go” phase of my retirement. As I get older, I will re-evaluate the annual war-chest amount as I approach the “slow-go” and “no-go” stages of retirement. My financial plan suggests that I’ll be able to stick with my $7,500 a month “paycheck” and war-chest withdrawals, both increasing annually at the rate of inflation, until I’m 95.

in the spirit of carpe dayI’ve had recent war-chest experiences like witnessing the Great Wildebeest Migration in Kenya, paying extra to get nearly invisible hearing aids that make me less self-conscious, and watching my girlfriend rejoice when I replace her broken dishwasher. At the end of the year, I look at the money left in my war-chest as lost joy, not savings.

For decades, I acted like Aesop’s famous ant, who worked in the summer to store food for the winter, while the grasshopper played and later starved.

Thanks to my vacation mentality, paycheck and war-chest, I’ve become wiser. I enjoy retirement because I Both In the past he toiled like an ant and now he enjoys safely like a grasshopper.

Do you have a story to share about saving for retirement? Contact the editor, Charissa Cheong, at ccheong@businessinsider.com

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