Americans, on a whole, spend too much on their retirement plans! That should get the keyboards pounding with objections without even going any further. Let me start with the exclusions: social security, unfunded corporate pensions and existing plans. That said, some people have stopped typing. But don't give up yet because I am sure that I am a rare voice in the wilderness that feels you are spending too much on retirement and not enough on your life. Now for the big caveat: this is especially true and directed to people who own their own homes. (You realize I am talking to you even if your equity is 1% and the bank owns 99%). My thinking is simple: pay off your house, whatever price it is, and that will be all the retirement you need! Now you can start objecting.

Why do I feel that way? People in my experience do not change their habits, lifestyle, or hopes and fears just because they quit working. My father who was in the garment business all his working life insisted we buy quality clothes because they would last longer. Expensive did not equate directly to quality. As a kid we shopped until quality really equaled value. When my father finally quit working (around 80) and had money from his house he sold that was paid off, he never stopped shopping for quality and absolutely refused to pay for expensive clothing even if it did equate to value. His lifetime of habits didn't change.

My friends in the travel industry tell me that although many people talk about extensive travel when they retire, if they hadn't traveled in their working years they generally take one or two trips and that's that. They do not enjoy the discomfort of normal travel and miss their life long routines. Does this mean nobody continues to travel? Absolutely not, but I am generalizing.

Let's take a running total to this point. You most likely will not change your shopping habits when it comes to clothing and other merchandise, and you probably won't take more trips than you normally take. Even though you put additional monies away in a retirement plan, those dollars earmarked for the aforementioned activities might not ever be spent in your leisure years.

Before we go any further I am a big believer in 401(k)’s because your employer matches some part of your contribution, and that is free money. If it is matched dollar for dollar I would maximize your investment every year, and if you don't have the money to do that I would take it out of my house. (Contradictory advice? Not really because you will have time to pay off your house while you may not get the matching opportunity again.).

Food, recreation and entertainment are items that are elevated in importance when you retire, but probably not the way you are thinking. We have big dreams about at least recreation and entertainment, but when the time comes to enact them, it will most likely be done in a more restrained way than we had thought.

Let us start with my passion: golf. I get to play on an average 1 or 2 times a week as I have a second home an hour and a half from my main residence on a golf course. In fact I am a member of the club and we have six courses, but that doesn't give me any more time to play than if I wasn't a member at all. When I retire I will be somewhat like the rest of the guys (except I will probably be in my 90’s) and play every day. The only added expense is lost golf balls.

Fishermen will fish more, hikers will hike for longer periods of time, and tennis players will go for more sets. I don't anticipate going to St. Andrews to play golf as something I would do more than once, nor would I expect tennis players to need to play Wimbledon. In retrospect, I don't need a big retirement savings for recreation.

Food is easy. Most people will be restricted by their doctor or their stomach, from having all the great things we have been holding back on during our lifetime. Just because you have gotten old doesn't mean you don't feel young, want to look good or relish walking the floor all night with an upset stomach. No extra dollars expended here.

If you live on the west coast you may go to Las Vegas or Lake Tahoe a few more times, but you probably will find a little less expensive place to stay, eat in the buffet more than you did when you were working and of course get all the early bird specials because you and I will eat at the sensible time and forgo being seen at the "right time".

My point is saving for retirement is a fine thing to do if you have extra money. Most people have extra credit card debt, not money. Most people have homes and cars and clothes and golf clubs and retirement plans, but no reserves. Before you can retire you need to get through life. Start retiring your debt, followed by the debt on your house, and if you don't get to the part where you have built substantial balances in your IRA you will still be okay. Add as little as $25 a month to your house payment and you will be amazed what that can do for you. Continued...