Categorized | Retirement, Saving Money

Be Responsible With Retirement Planning


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A common focus in the middle-aged generation is saving money. They go around bragging to others about frugal spending or these great deals they got on products or services. You see the media being saving-centric with their cookie-cutter ad campaigns focusing on low APR’s or this incentive or that promotion.

(Photo credit to: GerardwObrien.com)What’s probably the most amazing aspect of our savings minded generation is the fact that they are the worst money saving individuals. They may conquer short-term savings here or there, but a surprising amount of the middle-aged generation (which may also include yourself) neglects any sort of long-term savings plans. Don’t believe me? By the end of this, you will. The aspect that many will be surprised or skeptical over is how easy it is to solve this problem.

The Truth About Retirement Planning

There was a recent study that was published focusing on companies who offered their employees the opportunity to attend a free financial planning seminar. Now, as I mentioned before many individuals in their 40’s are concerned with financial stability, yes? You would think that the attendance rate for these free financial planning seminars would be high or 100%?

You wouldn’t be any where further from the truth. A stunning 17% of those invited actually attended the program.

Where the stats really get scary:

  • Out of the 17% of attendees the individuals who were not participating in their company’s 401(k) program prior:
  • 100% “planned” on enrolling in their company’s 401(k) program.
  • 14% actually did.
  • For the individuals who were participating in their company’s retirement program prior to attending the seminar:
  • 28% “planned” to increase their participation, acknowledging the need to be more active in their program.
  • 47% “planned” to change their fund selection, as most of them used the default option of a Money Market, which will most likely yield almost nothing.
  • Out of these low percentages, less than 50% of these individuals actually made any changes.

The Problem Many Face

First and foremost, retirement planning doesn’t have to be a trivial journey. These statistics shouldn’t surprise you. There’s a simple explanation for why many people refuse or neglect attending an offered financial planning program. Imagine you attend, and you walk into one of you co-workers or out of office friends. For the past few years you’ve been bragging about how savings savvy you are, but lone behold here you are at a financial planning program? What it all goes back to is not wanting to look inadequate to our peers. Many feel that they would be judged for such inadequacies and miss out on opportunities to improve their future. Take a moment and think about it for yourself, there have to be some moments of self-doubt in your past. We’ve all been victims of that “supposed” peer judgement.

For many of us, this high-school effect can still cripple our actions and prevent us from simple accomplishments. It doesn’t have to be this way though, and we should not let it affect our future.

Ways to Be Responsible With Retirement Planning

(Photo credit to: Cutecoder.org)When you realize you need to have a more active strategy in retirement planning, consider these tips and ideas below to help you get on the right track to saving for retirement without being deterred!

Does your company offer Employer-Match Retirement Programs? If they do, why aren’t you already participating in them?? There are so many companies who waste billions of dollars in these programs because their employees refuse to participate. Usually it comes down to two main reasons or excuses why they avoid this program:

Can’t fit it into my budget: One of the most common excuses that many individuals use on instances where they also have to shell out some money. In these types of circumstances, take the leap and learn to live on a consolidated budget. There are plenty of different ways to save money. It may be a little difficult at first, but after awhile you’ll start to see the long-term benefits and be amazed at how much you can save!

Don’t have time to fill out the paperwork: To you, the individuals reading this that have this common excuse in their rotation, get off of the lazy bandwagon! Grab a pen and an envelope, sit down and devote a few moments of your “precious” time to fill out a form. Spending fifteen minutes now can save you fifteen years of living in your children’s musty basement eating cans of cat food.

Companies offering these types of retirement incentives are doing so for your benefit. If they will match the funds you are contributing, why not do the most that you logically can? Make sure you are not overextending yourself with your contributions, but also make sure it’s a decent amount that you can build off of over time.

Stay persistent. So many people find themselves temporarily excited and motivated to do the right things only to lose steam a short way through. Similar problems can happen to those who genuinely want to save for retirement. In order to responsibly plan for retirement, you have to train yourself to stay motivated. Establish both short and long-term goals that can assist you during the way. Setting milestones can help keep the self-esteem high making the goals for long-term saving feel much easier to obtain. Another thought to keep you motivated is to think of your children. Don’t you want to set a good example, not only showing them the fundamentals of saving but also the value of persistence? These are habits that can easily be passed down from your children simply witnessing your actions. Additionally, many of those who neglect to save long-term usually wind up becoming their children’s problem. Tables turn on them as they have to wind up taking care of you, putting food on your plate and a roof over your head. Is that what you really want?

Overcome obstacles, stop making excuses. Consider the saying “We are our own worst enemies.” This rings true, as there are many times throughout our lives where we make excuses or let obstacles stand in our way. From the large to small we tend to let our imperfections create barriers which can lead to detrimental results.

There are usually two different types that stand in our way.

Active: are physical obstacles like plastic packaging, or naysayers and degradation gives us the impression that we cannot accomplish our goal. Many times we’ll simply submit to this active barrier regardless of its scale of effect instead of simply making it go away by removing the physical obstacle.

Passive: is when you realize you are missing a pivotal piece to complete your task or reach your goal. This can be something as simple as a stapler or pen, or even be something complicated like lacking the training or finances. Different passive barriers call for different resolutions, though many are usually solved once someone reorganizes or restructures their operations.

For more information on the different barriers, take a look at Business Insider’s latest article.

It may be difficult at first…Using the above advice will definitely help you achieve your long-term goals for retirement. Sticking to these techniques may be difficult at first, but don’t let that discourage you. After a while it will be as if you had always had this habit and will feel like second-nature. On top of that you’ll have the great weight of financial stability lifted off of your shoulders. Remember to stick to what we said!

Retirement Planning for the Future

Just as technology evolves and adapts to our needs, so do the services that are offered to us. One in particular ensures that you have a foundation for your retirement savings without bothering you with any forms to fill. It’s called “Automatic Enrollment (AE) 401(k) Programs.” These automated programs work in a way similar to email subscriptions. Like a newsletter email list, your information is automatically added into the program with the contributions automatically set to be deducted from your pay each period. The way to stop the automated service is to simply “Opt-Out” of the program as they would on an email list.

These new types of programs are literally reshaping the ways some individuals plan for retirement. In one instance during a study this easily made participation in the program soar from 40% to 100% and consistently stay there for some time.

With programs like AE 401(k) there still seems to be other ways companies are attempting to make it easier for individuals like yourself with your retirement planning. The problem is, they can’t do everything. There has to be active participation for you and everyone else as well. Once more realize the importance of long-term saving this will make launching similar programs much easier.

Responsible Retirement Planning Bottom Line

Like I told you in the beginning, it’s scary how few of us actually take advantage of these amazing opportunities companies offer us. The more of you who realize the true potential of employee match programs, goal setting, and staying persistent will be the ones who ensure some relaxation during the future being supported off of a large nest egg. That definitely beats the alternative of those who will neglect to save and wind up living in the basements of their children’s homes while scraping to buy actual food that’s meant for humans instead of dogs or cats. It may sound extreme but it is the scary reality many face when they ignore saving for the future. Consider what group you want to find yourselves in, I wish you good luck saving!

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