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Financial Regret: Preparing For Retirement




Financial Regret: Preparing For Retirement

According to, at least three in four Americans have regrets of a very specific financial nature. 

This is especially true of older Americans, who have whole lifetimes behind them to ponder and regret.


Their Number One Regret, of Course, is Not Saving Early Enough for Retirement

The vast majority of Americans will never be billionaires—the financial system simply does not work that way. 

Therefore, a certain amount of saving has to be done if one ever wishes to retire

Yet, a staggering 18% of Americans say that their biggest financial regret is not starting that process sooner.

The numbers are even higher for those who are 65 and up—more like 27%.


Multiple Financial Advisers Say to Start Saving for Retirement in Your Twenties

The idea of starting sooner is not so much that you have more time to put in more money, though that can also be the case. 

The secret is in the power of “compounding”—the interest has more time to add to your money. 

Vanguard offers an excellent illustration of this concept:

You start your retirement nest egg at 25, and end up only putting $150,000 in your savings; your friend starts at age 35 and puts twice as much in at $300,000. 

However, when you are both 65, you have $1,058,912 and your friend only has $838,019. 

It seems like black magic, but it’s just the way interest works—that annual 6% return had more years to work on your account, and now you’re a millionaire.

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Another Major Regret is Not Having Saved Enough for Emergency Expenses

Back in December, a Google Consumer Survey found that 21% of Americans had no savings account at all. 

Furthermore, 62% had less than a thousand dollars in their savings accounts. 

In spite of the fact that credit is costly, according to Bankrate, 12% of people say that credit cards are their backup plan instead of savings accounts.

Other Common Financial Regrets:

  • Student loan debt (9%)
  • Credit card debt (9%)
  • Not preparing to pay for your children’s education (8%)
  • Buying more house than you need and can afford (3%)

Forbes Says 21% of People Also Regret Not Having Finished Their College Education

There is already a steep difference in projected earnings between those who merely finished high school and those with a college degree. 

That gives non-graduates something to regret in itself. 

However, there are those who started their college degree, racked up debt doing so, and never finished.

Read more: If you want to lower your student loan payment, click here

Forbes Also Says 19% Regret Letting Their Partner be in Charge of the Money

Apparently, combining finances with a spouse is a regret many people have. 

It raises questions of dependence and control. 

Furthermore, it’s a common bone of contention, often associated with subsequent divorce.


In Spite of All the Regret, Bankrate Says that People Are Feeling More Financially Secure Than They Were Last Year

More Americans surveyed say they feel better, not worse, about their current financial situation this year, at a rate of almost 2 to 1.

So Why All the Regret?

It may be that regret over money is simply a part of the human condition. 

For instance, one wouldn’t expect CEOs, executives, or multimillionaires to have any regrets about money at all. 


However, Business Insider begs to differ in its article on successful people’s financial regrets:

Jon Stein, CEO of Betterment, Regrets Trying to Beat the Stock Market

He claims that he thought and over-thought, trying too many complicated schemes and even investing in Enron. 

He regrets the lost money but also regrets the lost time with family and friends.


Sallie Krawcheck, Chair of Ellevate Network, Regrets a Job She Was Rushed Into

She was drawn in by a CEO, who promised to stay for a full two years to help her learn the ropes. 

The transition was rushed, her requests to meet coworkers in advance were denied, and her financial agreement was extremely informal. 

Naturally, the CEO ditched her within a few months, and the job was a financial disaster.


Scott Adams, Creator of Dilbert, Let His Bankers Manage a Portion of His Money.

Three words:  Enron and WorldCom.  Said bankers are no longer managing his money.


Conclusion:  Everyone—rich, poor, and in-between, has their financial regrets. 

But one of the biggest of all is not preparing well enough for retirement

Everyone wants—and arguably deserves—to live out the latter part of their lives in comfort and dignity.

So start saving now.  Especially if you’re twenty.  Compound interest is black magic, and it will work for you.



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Why You Should Consider Filing For Social Security At Age 62




Why You Should Consider Filing For Social Security At Age 62

Earlier this week we discussed four common regrets that retirees have when they look back at their golden years. One of the most common regrets was filing for Social Security benefits at 62, the earliest possible age. According to the Social Security Administration, about 1 out of 3 people apply for benefits at that age.

The regret is that if they had waited longer to file for their benefits, their monthly check would be much larger. For example, by delaying filing for Social Security until age 70, your monthly benefits can be as much as 75% larger than someone who filed at age 62. That’s because benefits grow by a guaranteed 5% to 8% each year that you delay your claim.

But there are always two sides to a coin. Today we wanted to discuss the benefits of filing for Social Security as soon as possible. With this, you can decide which approach you believe will benefit you the most.

The Case For Filing Social Security Early

The earliest you can file for Social Security benefits is age 62, but each month you file before reaching your full retirement age (FRA) cuts your monthly benefit amount. As an example, if your full retirement age is 67 and you start your claim at age 62, your monthly check will be reduced by approximately 30%.

Despite the reduced monthly benefit that comes with filing early, tens of millions of Americans make that decision every year. And it boils down to one line:

We have no idea what the future holds.

The financial benefits of waiting until age 70 to claim Social Security make complete sense. But we don’t know how long we will live, so we don’t know if the trade-off is worth it. If we knew we would live a long, healthy life until age 100, we would all delay filing until age 70 and reap the maximum reward.

But if you decided to wait until age 70 to claim, and unfortunately passed away before that, you would have foregone all the retirement income from age 62 on.

Waiting to file is a gamble, but so is giving up guaranteed monthly income starting at age 62.

Deciding when to claim your benefits requires serious thought and shouldn’t be a hastily made decision. And we aren’t saying that filing Social Security immediately at 62 or waiting until age 70 is the right choice. Every situation is different. If you are still healthy and working, waiting a few years passed 62 to claim but not all the way to 70 might be a good compromise. You’ll get a larger check than had you claimed right away, and your regular working income can make up for some of the reduced benefit amount since you didn’t wait until age 70.

The most important thing, whether you file at 62 or 70, is to find enjoyment in your golden years.

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Mnuchin: Next Stimulus Coming By End of Month, No More Extra Unemployment Money




Mnuchin: Next Stimulus Coming By End of Month, No More Extra Unemployment Money

Treasury Secretary Steve Mnuchin said the next stimulus bill will be much more targeted than previous bills. He also said the goal is to get the next bill approved between July 20 and the end of this month. That time is when Congress will return from their holiday break and before they leave for August recess.

On Broad Stimulus Measures

It appears the White House will not support the type of broad stimulus measures of the previous bills. Instead, it will focus on direct payments to Americans. In an interview with CNBC yesterday, Mnuchin said “we do support another round” of stimulus checks to individuals. This mirrors the $1,200 payments that the government sent out as part of the $2 trillion rescue legislation passed in March.

Mnuchin didn’t mention whether he supported the idea of a $40,000 income cap to receive a check that has been floated by GOP lawmakers. The income cap for the first stimulus check was $75,000. He did say that he spoke with Senate Majority Leader Mitch McConnell. He also mentioned the “level and criteria” for checks would be discussed when lawmakers return to Washington.

Any new stimulus bill would likely not include proposals from the Democrats that include hazard pay for essential workers. It likely won’t include a longer extension of strengthened unemployment benefits, mortgage and rent relief, and support for state and local governments, too.

Mnuchin reiterated that the White House isn’t in favor of more relief money for states and municipalities to make up for lost revenue. Some state and local governments are considering trimming essential services as costs balloon and revenues drop. He said the administration does not want to “bail out” states that were “mismanaged” before the virus hit.

On Unemployment Benefits

Another critical topic the lawmakers will tackle the end of the enhanced unemployment benefits on July 30. They will do so when they return to Washington D.C.

Mnuchin said the White House has no interest in extending the enhanced benefits any further. Instead, he said it wants to change how they pay benefits. He did not give details. However, he did hint that unemployed workers shouldn’t be able to earn more money compared to full-time employees

“You can assume that it will be no more than 100%” of a worker’s usual pay, Mnuchin said. This echoes many Republicans who argue the additional benefits are preventing some from returning to work. These workers do this so that they make more at home than they would at their jobs.

While Mnuchin says the White House isn’t in favor of extending unemployment benefits, it is extending the Paycheck Protection Program that provides loans for small businesses. Earlier this week the Trump administration released a list of companies that received loans from the government. With that, backlash ensued as numerous businesses tied to wealthy individuals were found to have requested funds. Of the $130 billion remaining in the program, Mnuchin said he wants new relief to be “much, much more targeted” than past rounds of funding.

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Kudlow: Economy Doing Great, Second Shutdown ‘Really Big Mistake’




Kudlow: Economy Doing Great, Second Shutdown ‘Really Big Mistake’

White House Economic Advisor Larry Kudlow says that the country is squarely in the middle of the “v-shaped” recovery that everyone had hoped for, and despite reports of coronavirus hotspots popping up, shutting down the economy for a second time would make the “solution worse than the disease.”

Kudlow spoke on “Fox and Friends” yesterday and said that the White House is monitoring the jump in new coronavirus cases in states like California, Arizona, Texas and Florida, but added that as a country we now know what works to stop the spread, and just need to work together.

“We know the right mitigation, which has worked, and if we use that wholeheartedly and respect each other, I think we’ll get out of this pretty well and it will not stop the V-shaped recovery.”

On A Second Shutdown

He added that a second shut down would be a “really big mistake.”

“Another shutdown, in itself is controversial,” and would “do more harm than good,” said Kudlow before adding, “It would harm everyone. Not just businesses — the V-shaped recovery would give way. It would harm kids, we saw numbers on depression, drinking and so on… that solution would be worse than the disease.”

Kudlow highlighted the job growth in the last two months, and pointed out that jobs are being added back so quickly, workers are now quitting jobs to search for new, higher-paying ones.

He said there existed a “tremendous burst of jobs in May and June” and “tremendous record hiring rates. People are starting to quit their jobs again, which is extraordinary, in order to shop around for better jobs and wages.”

All those workers looking for jobs should bring down the unemployment rate to as low as 7% iby the end of the year, according to St. Louis Federal Reserve President James Bullard.

That would be quite a rollercoaster ride for the job market, which has swung from a 50-year low unemployment rate of 3.5% earlier this year, to a post-WWII high of 14.7% in April.

U.S. Economy Doing “Very Well”

Appearing on “Closing Bell” yesterday, Bullard said “I think we’re tracking very well right now. Seems to me like by the end of the year you can get down certainly to single digits, probably even below 8%, maybe 7% by the end of the year.”

A surge in new cases could slow the re-hiring of workers across the country, but Bullard believes that wearing a mask will become standard and that will help bring back jobs and boost the economy.

“If we get to that situation, we’ll have the disease under control,” he said. “What I like about that scenario is it does not rely on a vaccine coming or a therapeutic coming. We can use simple, easy technology that we have today, get a good situation, get most of the production back to normal.”

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