Retirement can be a long, confusing process, especially if you started planning for it in your 20s or 30s. It can also be confusing because it comes with such an important set of financial decisions. Fortunately, we aren’t without guidance. Here are some of the things seniors say are their biggest financial regrets—and how you can avoid them.
“Don’t get into too much debt” is advice that applies pretty much at any age. A variety of factors make this easier said than done, though. Credit card debt, a mortgage, or student loans can all still affect you during your senior years. Worse is that many credit cards will raise your interest rate to a “penalty APR,” if you miss a payment. This can be as high as 25 or even 30%, which may raise your debt faster than you can pay it off.
If you’re in debt now, start planning a debt reduction strategy so it doesn’t affect your retirement.
Not Planning/Saving Enough
The last thing you want when you retire is to find out that you haven’t saved enough. Generally, the more you save in your younger years is more you’ll have for retirement. If you’re worried about saving enough, take advantage of retirement calculators to figure out how much you should save. You can also take advantage of special “catch up” programs to pad your retirement fund.
Not Cutting Back
In the same vein as the previous regret, lots of seniors regret spending frivolously in their younger years. It’s never really too late to start cutting back, though. If you’re looking to put a little extra cash back into your pocket, reevaluate your budget. Then get rid of the nonessentials and enjoy a healthier savings account.
Bad Spending Habits
While going to the grocery store and dropping extra cash on things you don’t need might not be the greatest spending habit, “bad spending habits” refer to the more damaging ones. This includes things like repeatedly spending more than you can afford. It can include credit card purchases, but it can also include things like buying a house or car you can’t afford.
Not Planning Your Funeral
Understandably, funeral planning can be a touchy subject. No one wants to think about what’ll happen once they’re gone! However, funerals are expensive! Though it’s a difficult conversation, it’s important to talk through your plans so your loved ones know what to expect. Some funeral homes will even let you begin paying in advance for their services.
Ready to start saving on everyday expenses? Check out our roundup of this week’s best discounts!