Take the stress out of retirement savings


Many people are unprepared for retirement and are stressed because they don’t know what to do.

No matter how old you are, how much money you’re making, or when you plan to retire, chances are you’re experiencing at least a little stress about your retirement savings. It’s a concern I avoid entirely, but it gets harder to ignore as I get older.

About one in three Americans has no retirement savings at all, and 37% of those in the 35-44 and 55-64 age groups have $10,000, according to a recent GOBankingRates survey. I have the following savings. It’s understandable that many people are stressed right now, as most people need more than that to retire comfortably.

Let’s take a look at what causes these stressors and what you can do right now to ease the burden.

Many people just don’t know what to do to start saving for retirement…and that lack of knowledge leads to anxiety whenever the topic comes up.

I don’t know what to do. “Retirement savings” is a huge category, with dozens, if not hundreds, of options. Tax strategies, retirement accounts, investment vehicles, and investment markets are all possibilities, but unfortunately, these are not the topics usually covered in school. Many simply don’t know what to do to start saving for retirement…and that lack of knowledge can lead to anxiety.

Anxiety about investment knowledgeMany people inherently know that long-term investing is the best way to build wealth and achieve financial stability, but they don’t trust their own knowledge, which is why they invest long-term. Nearly two in three Americans would rather hold money in cash than endure market volatility, according to a study by Allianz Life.

limited resourcesSome people are stressed because they are not earning enough money to save for retirement. About 60% of American families live paycheck to paycheck, so this is a major source of stress.

Emergency savings and unexpected developmentsA plan to save $500 a month for retirement sounds like a reasonable idea, but what happens if your car breaks down? Or does your child need urgent medical care? The thought of being tied up with money can be another source of stress.

There is no quick strategy for building sufficient funds for retirement, and no quick way to relieve retirement-related stress. But there are some things you can do to reduce stress, at least temporarily. All this takes just a few minutes.

1. Gather more information about your investment plansFind introductory content online on how to start an investment program. There are many sources of information, such as videos and podcasts, that provide information about investing in plain English. If one source doesn’t make sense, move on to another. You learned something new and have a new bookmark to refer to for future financial questions.

2. Run an auditDo you know how much you are currently saving for your old age? Does recognizing what you don’t know cause anxiety? Now is your chance to figure it out. Take 10 minutes to review your top accounts, including 401(k) and other financial accounts, and calculate your savings. If your total seems low, at least you know how low it is. This will give you the impetus to plan your next steps.

3. Schedule a time to speak with a financial expertIf you are completely new to the investment game, it is advisable to consult an investment advisor. A few hours with an advisor can help provide the foundation you need to make better decisions moving forward.

4. Create a budgetFinally, approximate your current budget, including how much you want to save for retirement. There are some apps that can help you do this. A budget overview provides the vision and structure you need to make meaningful changes in your life.

These strategies alone aren’t enough to set you up for a comfortable retirement, but they can help you establish a mental and emotional foundation for thinking more seriously about what you want to do after retirement.

From there, savings and investment strategies become more accessible, creating a financial model that helps you retire comfortably.

Source: LendingClub Bank: Reality Check: 19th edition of the Paycheck-to-paycheck research series.

A new study conducted by OnePOll on behalf of Prudential found that 7 in 10 Americans are planning to retire, but not all are on track with their plans. Buzz60’s Chloe Hurst Talks!

John Ruedi is a Regional Marketing Specialist at Savant Wealth Management in Bloomington.

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