The Joy of the Splurge: Why a Little Luxury Makes More Sense at 62 Than at 22

I’ll admit this upfront: what I’m about to say might surprise you.

It even surprises me sometimes. I’ve spent most of my career preaching prudence: save diligently, invest wisely, live below your means. And yet, as I’ve grown older and watched clients move from earning to enjoying, I’ve come to a surprising conclusion.

Buying a few luxury items in your sixties isn’t the financial sin we’ve been taught to fear. In fact, it might even be good for you.

The Tug-of-War Between Logic and Desire

Here’s what I’ve learned from sitting across the table from hundreds of retirees and soon-to-be retirees: when someone really wants something – a ’69 Camaro, a beach condo, that shiny new truck that costs more than their first house – no amount of financial logic is going to stop them.

They’ll ask my opinion; maybe even hope I’ll give them permission to say yes. I used to think it was my job to talk them out of it. “You worked all your life to build this nest egg, so let’s not squander it.” It felt like someone was crossing the finish line of a marathon only to turn around and start running the other way!

But over time, I’ve realized something important: the desire to enjoy the fruits of your labor isn’t reckless, it’s human. The key isn’t denying that urge; it’s managing it intelligently.

When “Treat Yourself” Is the Smart Move

At 22, buying a luxury item usually means borrowing against your future. You haven’t had time for your money to grow yet, so that shiny new car or designer watch comes straight out of your earnings, or worse, it goes on a credit card. Every dollar you spend at age 22 is a dollar that can’t benefit from 40 years of compounding on your behalf. The opportunity cost is massive.

At 62, though? The math changes. If you’ve spent decades saving and investing, the growth on your money is now doing the heavy lifting. When you withdraw $50,000 to buy that long-dreamed-of convertible, you’re likely drawing from gains your portfolio has already earned, not the principal you worked so hard to accumulate.

That doesn’t make the purchase free, of course. You’ll still reduce your portfolio balance, and if it’s a traditional IRA, you’ll owe taxes on the withdrawal. But you’re not robbing your future self in the same way; you’re spending what your investments have created for you.

The 10-Year Rule (and Why It Matters)

Since the SECURE Act, most non-spouse beneficiaries of IRAs must withdraw the full balance within 10 years. That means the money you leave behind, whether in a traditional IRA or a Roth, won’t grow tax-deferred forever. Your heirs will need to draw it down, paying taxes on a traditional IRA or simply emptying a Roth by the end of that decade.

In plain English: the ‘forever compounding’ that once made it painful to spend from your nest egg isn’t what it used to be. The government has shortened the runway. That doesn’t mean you should drain your accounts tomorrow, but it does mean there’s logic in enjoying your savings while you can still enjoy them.

The Human Side of the Equation

Of course, markets can turn south. Inflation can nibble away at your plans. Life can throw you curveballs: illness, family needs, or a big, unexpected expense. No rule guarantees that once you retire, you’ll stay retired. So yes, a little humility and flexibility are still essential.

But here’s the other truth: the human mind is remarkably adaptable. I’ve watched retirees change plans mid-stream and thrive. They buy the boat, then later decide to sell it and travel instead. They purchase the lake house, rent it out part-time, and turn it into both a joy and an income stream.

So, when you find yourself daydreaming about something that makes your heart beat a little faster – that piece of art, that RV, that trip you’ve been talking about for decades – don’t dismiss it out of hand. Run the numbers, understand the tradeoffs, and if it fits within a responsible plan, go for it.

The Splurge Sweet Spot

There’s a sweet spot in life when your savings have matured, your kids are grown, and your time is finally your own. In your sixties and beyond, a carefully chosen splurge isn’t a reckless move; it’s a reward for years of discipline.

So, save diligently while you’re earning. Invest wisely. And when the day comes that your portfolio is working as hard as you once did, give yourself permission to enjoy a piece of what you’ve built.

If that means there’s a shiny new car in the driveway or a beach view from your balcony, I’ll be the first to say: you’ve earned it.