Most people understand that it’s important to save for retirement. But there are many other more immediate goals that compete for your limited funds.
A recent survey by the American Institute of Certified Public Accountants and Harris Interactive asked 1,009 adults to name their single most important financial concern. Retirement was the most popular response, but only 12 percent named exiting the workforce as their top financial priority. Coming in a close second was unreimbursed medical expenses (11 percent).
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Education expenses often vie with retirement for savings seniority. Some people say paying for a child’s college education (7 percent) or paying off student loans (7 percent) is a more pressing financial concern than retirement. Many people also say they need to eliminate various forms of debt including a credit card balance (5 percent) or create an emergency fund (6 percent) before they will be able to save for retirement.
Job loss, of course, generally makes it impossible to save for retirement. And the costs of buying a home, selling a home, and making mortgage payments compete for your paychecks. Other people indicate that their main financial worry is rising energy costs (8 percent), gas prices (4 percent), and expenses associated with caring for aging parents (3 percent).
Many of the survey respondents say they have delayed major purchases due to financial concerns including a car (27 percent), a medical procedure (17 percent), a home (16 percent), higher education (15 percent), and retirement (13 percent). Some people also put off major life choices including marriage (6 percent) and having children (8 percent) because they don’t feel it fits their budget. About half (54 percent) of the survey respondents say they are not currently able to save any money for the future.