Of course, you need a vacation. You've worked hard and you've earned the time off but is that upcoming vacation more important than your retirement savings are? A new survey by Country Financial suggests that right now, your vacation is more important to you.
The findings of the Country Financial Security Index suggest that Americans do worry about being able to afford retirement, but that worry is not great enough to spur them into action. Shorter-term concerns tend to take precedence.
Two-thirds of survey respondents said that current events in America make them concerned about their future financial situation, while almost one-third worry that they will need either to delay retirement or simply not retire at all. This should spur people into more comprehensive retirement planning, but the survey found that 51% of respondents do not include any consideration of retirement plans in their long-term financial goals.
Perhaps our definition of long-term really is not as long as it should be. When respondents were asked about their concerns for the future given their current financial situation, only 32% mentioned adequate savings for retirement. That came in fourth, behind affording unexpected expenses (44%), affording health care costs (41%), and taking a desired vacation (36%). Attaining a desired lifestyle and making monthly payments were right behind at 28%.
The survey highlights an enduring trait of Americans being more concerned about the here and now than planning for tomorrow. It takes discipline and planning to achieve a comfortable retirement. Do you have that discipline? If not, why not start to gain that discipline today by creating a budget that can help you to achieve all of the things on your list? An income surplus is necessary to build an emergency fund for unplanned expenses and health care costs, as well as building retirement funds.
Start by assessing all your expenses with a critical eye. Think of them in terms of value. Are you getting the full value out of a daily stop at your local coffee shop, or could you simply make coffee at home? How much would you save in a year, and would that money be put to better value elsewhere?
Keeping track of all your expenses for several months , no matter how small, will help you find places to gain early "wins" in your quest for savings, and build momentum for an overall improved budget. With your expenses clearly outlined, you can break them down into "needs" and "wants", helping you to establish proper priorities while removing temptations in your budget and, if you're being honest with yourself, you probably already know which expenses you can reduce or eliminate.
Leave yourself some small discretionary funds, because you won't stick to a budget that is too severe just make sure that you are getting value for your purchases.
Your improved budget should include a certain percentage of your income going to establishing an emergency fund and contributing to retirement, even if that percentage is very small. The important part is to establish savings as a habit. Direct deposits and alternate accounts that are devoted directly to retirement savings and/or emergency funds can help. If you don't see those funds in your take-home pay, you won't be as tempted to spend them on a short-term purchase that provides less long-term value.
Saving is a mindset, whether it's for retirement or any other purpose. Proper budgeting and planning can give you the framework and motivation necessary to meet your goals. In the end, isn't it worth less of a vacation now in order to have an easier time during your more permanent vacation, aka retirement?
Let the free Retirement Planner by MoneyTips help you calculate when you can retire without jeopardizing your lifestyle.
Originally Posted at: https://www.moneytips.com/americans-more-worried-about-vacation-than-retirement-savings
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