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Auther Created By:
Andy Masaki On 4th Apr,16
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3 Ways you are ruining your retirement

Most of the time it’s our own shortcomings and whimsical nature that impact our retirement savings than any other economic or political event. However, we go on cursing the stock market collapse, increased joblessness, decrease in the GDP and anything dour we come across.

National tax firm Deloitte did a survey about 401(k) savings and the data shows that many of us are just ruining our retirement through poor investment choices. One key finding reveals that the essential reason for not taking part in employer-sponsored retirement plans is just because of lack of awareness and understanding and not because of an unpredictable economy.

Put in simple, it’s because we are stupid that we don’t plan our retirement and not because we are worried about the job market. Are you too choosing to wreck your retirement life by not doing anything? Check out some of the things those might be harming your retirement.

1. You are not investing enough for your retirement: Though many want to save for their retirement, most of the time they divide the disposable income among priorities like paying for the mortgage, saving for the kid’s college, and only then for retirement funds. Using your disposable money for many causes is good as long as you invest at least 15% of your income towards your retirement savings. Why? A paid-off home is not going to bring you food during your retirement. Neither will your graduate kid. So it’s better to focus on your retirement goals first and then concentrate on other necessities.

2. You are not saving anything until your 40s: According to a new study conducted by personal finance site Bankrate, more than one third Americans haven’t started saving anything for their retirement yet. Around 70% of adults under 30 haven’t saved anything. One third of people between 30-49, one fourth between 50-64 and about 14% under 65 haven’t saved anything and hence ruining their retirement. The math is pretty simple. The sooner you start saving for your retirement, the less you’ll have to stock up each month for a peaceful retirement.

As per an estimation released by U.S. New and World Report, if you start saving at 25, you’ll just need to save $4,830 every year in order to pile up $1 million by 65. However, if you wait longer till the age of 40, you’ll need to contribute much more: $15,240 per year, assuming the same retirement age and annual return.

3. You’re giving more priority to your pet than yourself: Saving for retirement can wait but not our pets’ after-death plan. This is what the attitude of the mass towards finance is. A study conducted by Securian Financial Group on more than 900 pet owners reveals that 44% of us have balanced financial plans for our pets that include naming a pet caregiver as beneficiary of a life insurance policy.

We can have life insurance for pets but can’t open a 401(k).

The study also reveals that there are many who are willing to sacrifice their vacation (73%), long time saving (52%), credit card payments (24%), and lastly retirement contributions (22%) to keep a pet. There is nothing wrong in keeping a pet. However, make sure you’re not sacrificing your retirement for the same. Time is invaluable. Utilize the most of it and plan accordingly.

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