Retirement might seem far away, but it's never too soon to start planning.
By the time you reach retirement age, it’s too late to rethink your entire retirement plan. Fortunately, generations of people have already gone through retirement, and they have plenty of wisdom to share.
Should you have saved more or less? And could you stop wasting money on unnecessary purchases now that you'll regret later? Here are some wise pieces of advice that successful retirees want you to know.
Steal this billionaire wealth-building technique
The ultra-rich have also been investing in art from big names like Picasso and Bansky for centuries. And it's for a good reason: Contemporary art prices have outpaced the S&P 500 by 136% over the last 27 years.
A new company called Masterworks is now allowing everyday investors to get in on this type of previously-exclusive investment. You can buy a small slice of $1-$30 million paintings from iconic artists, all without needing any art expertise.
If you have at least $10K to invest and are ready to explore diversifying beyond stocks and bonds, see what Masterworks has on offer. (Hurry, they often sell out!)
Start saving earlier
While you can find ways to supplement your income and savings in retirement, you want to start from a strong financial base. And the earlier you start saving, the likelier you are to have one.
To have enough money for a comfortable retirement, you should be tucking away a good 10% to 15% of your income for as many years as possible.
Save more than you think you’ll need
Along with saving earlier, most retirees also wish they’d saved more.
Many advisors recommend having 10 times your annual income saved by the time you’re 67. That’s a hard number to reach if you’re only saving a few dollars here and there.
Meet with a financial advisor
Retirement advisors and financial planners can help you figure out how much of your income to set aside for retirement, where to invest your funds, and how to set financial goals that can help you retire on time.
For most people, the cost of hiring a financial advisor is a fair price to pay. According to the Employee Benefit Research Institute survey, 90% of individuals who worked with a financial planner said their planner’s advice made hiring them worthwhile.
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The Active Cash Card puts cash back into your wallet. Cardholders can earn unlimited 2% cash rewards on purchases — easy! That's one of the best cash rewards options available.
This card also offers an intro APR of 0% for 12 months from account opening on purchases and qualifying balance transfers (then 19.74%, 24.74%, or 29.74% Variable). Which is great for someone who wants a break from high interest rates, while still earning rewards.
The best part? There's no annual fee.
Don’t forget about taxes
Some of the most common types of retirement savings accounts, including 401(k)s and traditional IRAs, aren’t taxed until you start withdrawing funds from them in retirement.
As a result, the figure you see in your savings account isn’t the exact amount of money you’ll have to live on.
When you’re deciding how much money you need to save while you’re still working, make sure you take taxes into account. Otherwise, you risk saving too little.
Count on inflation
Like death and taxes, inflation is likely to affect your financial future. According to many economists, a healthy economy experiences a predictable, low amount of inflation each year.
But as 2022 showed, unpredictable global events can upend financial expectations overnight. Your dollar won’t go as far a few decades from now as it does now, so adjust your savings goals with future inflation in mind.
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Don’t wait to start traveling
Saving enough money is essential for a good retirement, but knowing when to spend instead of saving might be just as important for your quality of life.
If you're hoping to step up your travel game, it’s worth considering whether you should wait to visit or travel sooner rather than later.
Don’t waste money on new cars
New cars depreciate by 20% in their first year of ownership, and their value declines 10% a year afterward. And, even though millions of retirees still drive, they tend to drive for fewer hours than their younger counterparts.
Investing in a completely new luxury item that you’re going to use less and less as you age just doesn’t make a lot of sense, especially when you could use that money to boost your bank account for retirement instead.
Live within your means
Spending less than you earn is the best way to ensure that you’ll have enough money to live on once you reach retirement.
If you can avoid taking on debt, especially high-interest consumer debt, you’ll be better prepared to live on a fixed income later on. You’ll also establish healthy financial habits that will serve you well in retirement too.
Bottom line
Hindsight is 20/20, but once you’ve retired, you’re running low on time to apply the financial lessons you should have learned long ago.
It’s impossible to live with no regrets at all, but these pieces of wisdom could help you avoid throwing your money away and reduce financial regrets during your golden years.
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Wells Fargo Active Cash® Card
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Annual Fee
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- Select “Apply Now” to take advantage of this specific offer and learn more about product features, terms and conditions.
- Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months.
- Earn unlimited 2% cash rewards on purchases.
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