Saving for retirement sounds a little like eating kale. They say we “should” do both, but nobody really wants to. It’s hard to clearly see today what retirement might look like in the future. So who else needs some motivation to save for retirement? If the research is accurate two-thirds of us need to get serious about retirement savings. (The kale thing … that’s up to you.)
In fact, The Fiscal Times reports that every day 10,000 individuals turn 65 years old. Every day. That’s a lot of people retiring, thinking about retiring, putting off retiring, or wishing they were retiring.
Those who do decide to or need to retire will need some type of income or savings to fund their living. That’s where “retirement savings” comes into play.
If the word “retirement” bothers you, call it something else. How about a “future funds plan” or a “let’s change things up plan”? Name your plan something that provides some motivation to save for retirement. We call ours “Our Future Spending Plan”.
Are you tempted to tune out? Is it because retirement feels so far away? Or saving feels hopeless because you’ll never have enough? Or did we lose you at the mention of kale?
It doesn’t have to be scary can be exciting. Knowing that everyone is vastly different in what motivates them we will offer some cheery and not-so-cheery statistics to help motivate everyone. Some people need the crazy clown chasing them to get their attention. Others just need the mental image.
Some (Scary) Motivation To Save For Retirement
Social security won’t pay your bills. Social security should be called “social extra maybe” not “security”. We educate clients that social security was never set up to be used for more than one-third of your income.
Most people are still standing behind the starting line for retirement savings. Stats show 1 out of 3 couples have money saved for retirement. So you’re not alone if you haven’t started, BUT think about ways you could get in the race and be that #1.
56% of Americans currently hold less than $10,000 in retirement accounts. That’s maybe $120 a month, which is obviously not enough to live on. It’s barely enough to feed yourself for a month on that figure. Based on this figure many experts say, “the long-term financial health for U.S. households in retirement are in definite peril.”
Some (Not Scary) Motivation To Save For Retirement
Some families are making great progress. 1 in 4 Americans aged 55+ have more $300,000 saved. They’ve taken the steps to set aside money over the long haul. However, it’s important to realize if they are within ten years of retirement that savings translates to about $700-800 a month in income. Depending on where you live, your lifestyle, your health, and other factors, it’s good to keep that monthly amount in perspective.
On a great note, many will see that $300,000 move upwards more quickly as markets have been strong for the past eighteen months. Before that market growth was so slow people didn’t see their hard-earned savings grow very much.
More good news is that generations are getting smarter. About 60% of millennials have started saving for retirement. In fact, every generation that has followed the Boomers has upped their retirement savings game. Gen Xers are saving more than Baby Boomers and then Millennials are saving more than the Gen Xers. A super positive trend! A lot of Boomers savings are behind because the market was tough for the past six years. Millennials are doing great job saving. Maybe because they are watching their parents worry about not having enough retirement savings.
Knowledge is Key
Don’t go into panic mode if your savings aren’t where they should be. Dedicate some time to figure out what you need and how to go about getting there.
Knowing your Money Personalities can help this process because you have a better understanding of your strengths, your weaknesses, and any potential differences or conflict you have in your primary and secondary Money Personalities or those of your spouse. Don’t know yours yet? Take our free, online assessment.
You don’t need to fear retirement. It doesn’t have to be scary. And you don’t have to be a millionaire to do it. Start small.
But it does help to plan. You can’t change the rain falling in your life, but you sure can grab an umbrella. It doesn’t stop the rain, but it changes how it affects your life (and your hair). J
We want people to have enough to go where they are called to go and be blessed and be a blessing to others. Our friends who both have Spender as their primary Money Personality love to travel the country and give. Spending is a part of their DNA and it would be sad for them to have to stop being themselves in retirement. As primary Spenders it also wasn’t EASY for them to save for retirement, but they kept their long-term goal in mind. They travel the country and encourage leadership teams at rescue missions. Their retirement savings makes it so the missions don’t need to pay them for their excellent services. It is a gift they are giving many, many others in their retirement. They decided years ago to make it happen and they did it.
Everyone’s definition of retirement will differ. That’s great. But take the time to explore your feelings and your spouse’s about the future. Discuss some hopes and dreams; set some goals, and discuss your finances. Now.
Most of Americans are behind on retirement savings. That’s a current fact. But it doesn’t have to stay that way. Some just need some new motivation to save for retirement. You can get you there as a couple. And it will be so worth it.
Please let us know how we can help you with your relationship and your finances as you discuss retirement. We’d also love to hear your retirement stories – what works, what hasn’t, your dreams, your frustrations. Your honesty is welcome with us.
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Trying smiling next time you say “retirement savings”. You can do it.
Make it happen!
Scott & Bethany Palmer
The Money Couple