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14 Key Things Retirees Wish They Could Tell Their Younger Selves

Gabrielle Olya

Retirement is the culmination of decades of financial decisions, and the unfortunate truth is that some of those decisions aren’t always good. This is exceedingly common, in fact. At present, millions of Americans are making financial choices that will hurt them down the road. According to a GOBankingRates survey, an alarming 64% of Americans will retire broke.

To gain a better understanding of the financial decisions that can tarnish one’s golden years, GOBankingRates interviewed real retirees. Although they’re largely content, they all had at least one nagging money regret they still think about. But now you can learn from their financial mistakes to ensure a happy retirement.

Last updated: Oct. 17, 2019  

Invest More in Real Estate

“You know how when the Christmas catalogs come out, you change your mind a dozen times about what you want Santa to bring you?” said Mary Ann Huntington. “That is a good way to describe how you wish you would have done things differently with retirement.”

Though Huntington and her husband had many exciting entrepreneurial ventures over the years, looking back, she wishes they had done one thing in particular differently. “Being self-employed most of our working years, we didn’t have a lump sum saved like couples who work for a company,” she said. “[With the] small amount we did have, I wish we had bought properties in small communities around where we live.”

“You really can’t go wrong investing in land,” the former realtor added. “The few times we did it, we did well. If only we had listened to ourselves and done it more often.”

What You Can Do

Real estate investment can be a scary prospect for the average investor. You have to make enough to cover maintenance, utilities, insurance, taxes and more on your properties. However, it can be lucrative.

You can make money off of real estate investments in a number of ways:

  • You can become a specialist in the real estate industry, taking a commission for each property you sell.
  • You can flip houses for a profit.
  • You can become a landlord and have cash flow income from your tenants.
  • You can invest in a Real Estate Investment Trust (REIT), a corporation that purchases properties using investors’ money and is required to pay dividends — meaning you’d receive regular income.
  • You can purchase land and sell it for a profit later.

Don't Focus Too Much on Making Money

Former college professor, researcher and social worker Kathleen Fox wishes she had focused less on money over the years.

“I worked very hard for most of my life and put aside just enough to live on (pension and Social Security) when my husband and I retired,” said the mother of three. “The one regret I have is that I did not take more time off to spend with my children. It all went so fast, and I regret every day that I was off working, usually in a job I did not really like, while they were learning and growing — days you can never get back.”

What You Can Do

Undoubtedly, one of the best parts of retirement is the time you get to spend with family. However, if you spend too much time looking toward the future, you might forget the importance of the present.

To ensure you don’t waste valuable time with loved ones, try one of these tips:

  • Institute a family night during which you play games, watch movies or simply recap your days over dinner.
  • Take regular vacations. There are plenty of ways to have an affordable vacation, including staying in a local hotel and exploring your own city.
  • Request a flexible work schedule or shift your schedule so that your hours align with your child’s.
  • Take advantage of any employer-provided family time. Some companies allow you to take a certain amount of time off for children — so don’t miss that dance recital or soccer game if you can help it.

Invest More and Be Less Cautious

“I wish I would have invested a larger percentage of my salary,” said Lito Dayrit, a retired financial analyst who lives in Texas. “I also wish I’d been less overtly cautious about investing.”

The Philippines-born family man said he wishes he had come to America earlier, too, which would have afforded him more opportunities to earn, save and invest.

Related: The 50 Best Places To Retire — and What It Costs To Live There

What You Can Do

Fortunately, there is no shortage of options out there for investing. Mutual funds, commodities, annuities, micro-investing and property are just a few choices available.

No matter which vehicle you choose, the point is to invest as much as you comfortably can as soon as possible. The sooner you start investing, the longer your money has to grow, and the more money you put in earlier on, the better — all thanks to the rules of compound interest.

Investing can also be as little or as much of a gamble as you make it. If you choose a certificate of deposit, for instance, you have zero risks. You lock in your money and your money grows, usually at a higher rate than a savings account. It’s also FDIC-insured.

If you’re investing in stocks and bonds, on the other hand, you can adjust your risk tolerance based on a number of factors, including how close to retirement you are. Someone in their 30s will likely be far more comfortable with a riskier stocks and bonds split (bonds being less volatile than stocks) than a person who is five years from retirement and can’t stand to lose anything.

Take Advantage of a 401(k)

“Back when we lived paycheck to paycheck with four kids at home, I wish we had put as little as $20 per pay period into a 401(k) or 403(b) (for educators),” said Pam Davis, a former speech pathologist at schools in the Omaha school system. “We thought we needed hundreds each month to save for retirement, and since that wasn’t an option, we had years where we put nothing into our accounts.” Once the couple became empty nesters, they tried to make up for lost time but it proved more difficult than they anticipated. They never reached their goal.

Fortunately, Davis worked in a field that offered a pension. “I had no choice but to give a set amount to the retirement account and my employer matched it at 101%. At the time, I didn’t even think about it, but now realize how wonderful that was. In fact, with little money in the 401(k) and 403(b) accounts, it is our lifesaver,” she said.

What You Can Do

You don’t have to live below your means to take advantage of an employer-sponsored retirement program. You decide how much you’re willing to contribute per paycheck. Start small if you need to, and as your salary increases, increase your contributions accordingly.

It’s especially important to capitalize on employer matching. Let’s say you make $30,000 annually or $2,500 a month. If you contribute 5% of your paycheck to your 401(k), that is equivalent to $125 per month. Now, if your employer matches up to 5%, you’ll have $250 contributed per month instead. You’ve just gone from tucking away $1,500 a year in your retirement fund to $3,000. That’s a big difference.

Save Sooner

Retired Trans World Airlines employee Dave R. said he focused on buying a home and having a family before he really got into saving aggressively for the future.

“Start saving as early as possible and as much as you can within your budget,” he said. “This will allow it to accumulate and build up your nest egg well over time.”

What You Can Do

You can save your money in a variety of ways, including the aforementioned investment options. Depending on how you invest, you’ll usually earn an average return rate far higher than a basic savings account at the bank, so investments make sense as a means of growing your wealth.

That said, one of the main reasons people tap their retirement funds early — a big no-no — is because they otherwise lack the savings to cover emergencies. A recent GOBankingRates survey revealed that nearly 44% of people who borrowed from their retirement funds ahead of schedule did so to pay off debt and/or bills. A nearly equal amount used their money to pay for medical expenses or a financial emergency such as a job loss (21.6% and 21.7%, respectively). So, though you should be investing for the future, it’s also important to save for life’s little curveballs along the way.

A high-yield savings account is one option for growing your emergency savings. There are several banks that currently offer 2.00% APY or higher with no minimum deposit.

Don't Waste Your Money on Depreciating Assets

“During my 20s, I was single and had reasonably well-paid management jobs in the foodservice industry, but I also had a history of putting a fair amount of my discretionary funds into depreciating assets like several used European sports cars,” said Timothy Wiedman, who worked as an associate professor of management and human resources at Doane University before his early retirement at age 62. “As used cars, they all developed mechanical problems at one time or another that usually seemed to require expensive imported parts and/or specialized tools to repair. I also took multiple week-long ski trips to resorts in Colorado, Quebec and New England, and one summer, I decided to buy a small sailboat. I justified this poor money management by telling myself that I could always ‘catch up’ later on my long-term financial plans after establishing a more solid career and seeing my income increase.”

Wiedman said that missing out on compounding interest by spending rather than saving made his poor spending decisions an even more bitter pill to swallow.

“Back then, I was only vaguely aware that the earning power of compound interest was based on time, so my initial delay in saving for the future could have severe consequences,” he said. “Thus, while opening an IRA as early as possible was vital, I didn’t do so until I was nearly 32 years old.”

What You Can Do

Invest in a retirement account, like a Roth IRA, as soon as possible.

“If a 23-year-old fresh out of college put $3,000 per year into a Roth IRA that earns a 7.8% average annual return, 44 years later at full retirement age, that $132,000 of invested funds will have grown to $1,009,275,” said Wiedman. “On the other hand, starting the same Roth IRA 22 years later will yield quite different results. Putting $6,000 per year — the current maximum for folks under age 50 — into that Roth IRA for 22 years still equals a total investment of $132,000, but at full retirement age, still earning the same 7.8% average annual return, those funds will have only grown to $324,562.  The delayed start will have cost our investor more than $684,000.”

Create a Comprehensive Financial Plan

Drew Parker went on to create The Complete Retirement Planner when he retired, but he wished he had paid more attention to retirement planning much earlier.

“When I was younger, I wish that I had known the full value of having a comprehensive financial plan,” he said. “I didn’t create one until I was actually ready to retire, but I wish I had created one decades before. To my younger self, I would say, ‘Create a financial plan as early in your career as possible so that you won’t have to guess and hope about what it will take to become financially secure.'”

What You Can Do

Create a financial plan — either with an advisor or on your own — that outlines your retirement needs and wants, and how to get there. Your retirement planning should take into account your values and goals, your risk tolerance, your goal retirement age and the lifestyle you want. Once you’ve established how you want your retirement to look, calculate how much to save for retirement and how long it will take you to save that much based on the amount of income you expect from your investments, retirement savings, Social Security benefits and other income streams. You can always readjust your plans as needed.

Move To a Lower-Cost Area

Michael Champion, a retired California Highway Patrol chief, wishes he made use of his job’s location flexibility.

“[I should have] utilized the advantage CHP officers have to voluntarily transfer statewide to any of 102 CHP offices,” he said. “Utilizing this ability, we could have transferred ASAP to an ideal low-cost location in the state to purchase a home early, and enjoyed the low housing costs in the ’80s and the equity of having a home now paid off. Since home ownership is the single largest investment by most people, this would have been an ideal strategy.”

What You Can Do

If you’re fortunate enough to have a job that you can do from multiple locations, consider moving to a place with a lower cost of living and lower housing costs. This can enable you to save more from each paycheck, as well as invest in real estate sooner than you might be able to in a pricier market.

Max Out Retirement Contributions

Champion said he wished he had enrolled in the state-sponsored 457(k) savings plan he was eligible for sooner, and also that he contributed the maximum payroll deduction each month.

“Continuing that for my 31-year career would [have been] an easy and excellent way to enjoy the tax benefits associated with the monthly deduction while maximizing the amount of money saved at retirement,” he said. Although he and his wife both contributed to their 457(k) plans for most of their careers, “the ideal time to start would be immediately after being hired,” said Champion.

Find Out: Here Are 30 Ways To Retire Earlier

What You Can Do

If you can afford to do so, consider contributing your annual maximum to your retirement plans. For 401(k), 403(b) and most 457 plans, the maximum annual contribution is $19,000, which would amount to $1,583 if you are contributing monthly. The contribution limit for IRA accounts is $6,000, or $500 a month.

Go After Promotion Opportunities

“A CHP officer is eligible to [be promoted] to sergeant after three years. Starting sooner up the promotional track would have afforded [me] the opportunity to increase my salary significantly sooner, and thus ending my 31-year career with much more money earned over my career,” said Champion. “I didn’t promote to sergeant until I had 10 years on the job. That’s a significant amount of money not achieved.”

What You Can Do

In most cases, you won’t get a promotion or raise unless you proactively go after it. Here are some signs you might be due for a raise:

  • You’ve researched typical pay for your position and realized you’re being paid less
  • You’ve taken on more job responsibilities
  • You’ve tangibly contributed to your company’s financial success
  • You exceed performance goals

If any of these signs apply to you, set up a meeting with your boss or manager to explain why you believe you have earned a promotion, and talk about promotion opportunities that might be available to you.

Pay Down Your Debt

Sandra Champion, a retired California Highway Patrol captain, said she would tell her younger self to reduce her debt, including her mortgage, car loans and credit card debt.

What You Can Do

Many financial experts agree that paying down debt is the key to retiring rich.

“If you have no mortgage, no credit card debt and no car payments, it may help reduce the risk of you running out of money during retirement,” said Steven Repak, a certified financial planner and author of “6 Week Money Challenge: For Your Personal Finances.” “That’s why the goal of having no debt by the time you retire should be at the top of your list.”

Some ways to pay down debt before retirement include:

  • Cutting household costs
  • Focusing on high-interest debt, like credit card debt, first
  • Using the “snowball” method to pay off the lowest debts first
  • Using windfalls to pay down debt
  • Getting a side gig

Track Your Spending

“[I wish I would have] tracked where my money went on a weekly and monthly basis,” said Sandra.

What You Can Do

Keeping track of where your money is going can help you distinguish between your spending on “wants” and “needs.” Once you have that sorted, you can see where you can cut down on your discretionary spending. Can you eat out less? Buy fewer clothes? Cancel one of your subscription services?

All of this extra cash can be funneled into a retirement account instead.

Spend Less on Gifts

Sandra believes that she squandered too much of what could have been her retirement savings on gifts for others.

“[I should have] put spending limits on gifts for family and friends, regardless of the occasion,” she said.

What You Can Do

Spending $50 here or $100 there on gifts for weddings, birthdays, holidays and other events really adds up over time, and when you’re buying gifts for close friends and family, you probably end up spending even more. A thoughtful gift is much more meaningful than an extravagant one, so it’s OK to limit your gift spending, even for those you are closest to.

Learn How To Make Money Doing What You Love

Robert Sullivan, a retired senior financial analyst, said he would tell his younger self to “follow your dream with your career but seek expert advice so you have a solid foundation on which you can base your abilities and can learn how to make a living doing what you love.”

In doing so, you might even be able to carry your passion into retirement while still making money through it.

What You Can Do

Ideally, we would all have full-time jobs that we love, but even if you’re not passionate about your 9-to-5, there are still ways to monetize the things you truly care about. Consider taking on a side gig that takes advantage of something you enjoy doing. This can be anything from photographing events on the weekend to selling crafts on Etsy or walking dogs in your spare time. Not only will this allow you to do more of what you’ll love, but you’ll also be making the extra income you can put toward your retirement.

A Little Goes a Long Way

Whether you are just entering the workforce or are far along the path to retirement, these retirees’ valuable insights shouldn’t be overlooked. Many of them underscore the importance of financial literacy. If more people were educated on topics such as investing, compound interest and employee benefits, nearly half of the population might not be looking at impoverished retirement.

Take a moment to evaluate where you stand financially and be honest with yourself. Knowing where you are relative to where you need to be can make all the difference in the long run. Hard numbers can be scary, but they can also spark action that will completely transform your future.

More From GOBankingRates

Erica Corbin contributed to the reporting for this article.


This article originally appeared on GOBankingRates.com: 14 Key Things Retirees Wish They Could Tell Their Younger Selves