Dis-Accumulation versus decumulation

Hi:

Well, many baby-boomers are in the throes of dis-accumulation.  Summer seems a perfect time for this activity as you can rummage through your garage, basement and attic and get rid of stuff through garage sales or trips to the dump.  You need to start this early, as it is time-consuming and sometimes emotional.  Lots of little decisions along the way which cumulates in clarifying your goals.  If you are not going to camp again, and make that decision, it's easy to let go.

Decumulation, another newish term refers more to getting rid of assets, taking money out of the system. We focus for the first fifty years on accumulating assets and then on spending them as we retire.  Some people want to die broke, while others focus on leaving a legacy of financial strength for their children. We are decumulating when we cash in dollars to go on a year-long trip or sell the family home and buy a smaller residence. The cash is now available for other things; the old "spending your children's inheritance".  If you are psychologically unable to enjoy your money, remember it is better for your kids to get money by working for it.

M