Some Americans are not as optimistic when it comes to retirement. According to a June poll by insurance company New York Life, only 31% are confident that their savings will be enough to cover their needs after retirement.
Current inflation plus the Fed’s efforts to control the situation and the contraction of the economy for the second month in a row made Americans prioritize short-term financial problems over long-term ones.. They even started withdrawing money from their savings to deal with the situation, according to another survey by the same company.
For those who are saving for retirement. the road is not easy, and if you add some more negative habits, then everything can become even more difficult.
1. They prefer to spend rather than save
Arete Wealth Management financial planner Eric Olson told financial website GoBankingRates that it’s easier to focus on the present than the future. By looking at your spending, you can probably find ways to save more money for tomorrow, such as cutting back on eating out, canceling or lowering the cost of cable TV, and doing away with credit card debt.
2. Underestimating the amount needed for retirement
Although there are people who have started collecting money for the purpose of retirement. they did not bother to see if there was enough money for a comfortable life during this period. There are online calculators such as the Vanguard Retirement Income Calculator or the Fidelity My Plan Calculator. When in doubt, you can consult a competent financial planner.
3. Diversify your portfolio
Many people don’t usually understand this, but it can make a difference. Spreading your money among the top 10 mutual funds can have more of an impact than simply investing in one. Looking at stories and their results is a good way to make sure your money is in safe hands.
4. Don’t Think About Emergencies
If you transfer all your savings to a retirement account but don’t set aside money for the unexpected, you could put your retirement savings at risk. If you lose your job, are unable to work due to illness, or have unexpected expenses, you may need to raid your retirement account.
5. Invest more money in a house or car
If you have a car or a house, you are probably in the habit of paying for them. If you need to pay more for your house or car than you can afford, You probably don’t have enough room in your budget to think about retirement savings. Downsizing to a less expensive home or opting for a used car that you can buy without financing can provide some breathing room.
Source: La Opinion
David Ortiz is an opinionated and well-versed author, known for his thought-provoking and persuasive writing on various matters. He currently works as a writer at 24 news breaker, where he shares his insight and perspective on today’s most pressing issues. David’s unique voice and writing style make his articles a must-read for those seeking a different point of view.