Many retirement-age Americans regret two major financial mistakes, according to debt expert Ja’Net Adams. The first regret is not investing earlier in a 401k, and the second is not putting enough savings in an emergency fund. Adams explained that the gradual shift from pensions to 401Ks has deterred consistent retirement contributions.
There is not a lot of education from companies around the 401K, and companies barely motivate employees to contribute to their 401K outside of job onboarding with Human Resources,” she said. Pensions, although becoming less common, were costly for employers, who had to make payments until the employee’s death. Additionally, “Over the last two decades, there have been many stories of pension plans losing all the money in them and employees being left with nothing,” Adams noted.
For Baby Boomers, it’s crucial to act now to secure retirement financial health. Adams advises paying down or paying off homes to avoid large bills in retirement.
Regretting missed opportunities in retirement
She also suggests putting all extra money into a 401K or other retirement plan to be in the best financial position possible. Lastly, Adams recommends considering post-retirement work to bring in consistent supplemental income. You don’t have to go to work at a department store or fast food restaurant.
Go back to your field and consult,” she suggested. The Federal Reserve’s recent decision to lower the benchmark interest rate by half a percentage point underscores an important financial reminder for seniors: plan ahead for retirement and diversify your financial strategies. Those dependent on Social Security will need to adjust their budgets and prepare for smaller checks in 2025 due to the interest rate cuts.
Ensuring a sound, diversified financial strategy is essential for a stable retirement. Adams emphasizes the importance of taking action now to avoid financial regrets later in life.
