Should I still be buying ASX shares in retirement?

Does retirement mean no more ASX investing? Not necessarily.

Smiling elderly couple looking at their superannuation account, symbolising retirement.

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Retirement is a very important phase of our economic lives. ASX shares can help build our wealth, but does entering our golden years mean no more ASX investing?

Every retiree's finances and budget are different. Some people may only have enough to pay for the bare essentials. Putting food on the table and having a roof over one's head is more important than buying a few ASX shares.

But, is it a good idea to keep investing in ASX shares for the people in retirement who have some financial flexibility?

Make space for enjoying life

Being in retirement will hopefully mean cutting down on working and taking more time for leisure, entertainment, family and other enjoyable activities.

Some people may have spent a lifetime saving, so it may be a bit foreign to purposefully choose to spend money rather than accumulating as much as possible.

I occasionally make the point that there's value in enjoying life today, rather than delaying it for many years down the track. For example, kids are only going to be kids for so long. My view is that there's not much use saying to a 10-year-old that you'll go to Disneyland in 10 years because it's better for compounding money – they will be 20 by then and (probably) too old!

I'd suggest it's a similar thing in retirement. If someone has a travel goal or something like that, it's better to enjoy it now while we're still most able to.

In my eyes, life experiences are the most important things to spend our money on.

Keep an eye on the ASX share portfolio, but don't tinker needlessly

I'm a big advocate for long-term investing, so I hope that the number of ASX share sales in retirement can be minimal – unless the capital is needed. The less investment decisions we make, the less stressful that will be.

But, at the same time, I'd point out that if someone retires they'll probably still need their money to last 10, 20 years or even more. Over that time, I think it's certainly possible that investors may need to change their ASX share portfolio over that time and make new investments. Even Warren Buffett makes changes in the Berkshire Hathaway portfolio every so often.

Having said all of that, and assuming the retiree has enough money to keep spending on essentials and experiences, any leftover money could be invested in ASX shares to make sure the money works as hard as it can while it's not needed.

In my opinion, (ASX) shares are capable of producing the best long-term returns of all asset classes, so while it may be wise to invest a bit more cautiously in retirement, there are still plenty of potential good years of investing in ASX shares. It could help the later years of retirement (such as aged care) or just fund better holidays.

Which ASX shares could retirees invest in? Well, that's what The Motley Fool's offering is all about – finding good ASX shares to invest in.

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway. The Motley Fool Australia has recommended Berkshire Hathaway. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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