Many Americans approaching retirement have financial regrets about their retirement planning. Only 28 percent of investors age 55 and older say they are highly satisfied with their retirement preparations, according to a recent Consumer Reports National Research Center survey of 24,270 online subscribers age 55 to 75. And over half (57 percent) of those surveyed have regrets about financial decisions. Here are six things older Americans regret about their retirement preparations.
Didn’t start saving earlier. Retirees who began saving and planning early in their career now have a significantly greater net worth, $1.1 million on average, than those who waited until their 40s to start saving, who accumulated an average of $868,000. Baby boomers and seniors who didn’t start saving until their 50s or later have even less, an average of just $651,000, the Consumer Reports survey found. Some 39 percent of the survey respondents say they regret waiting to save. But the amount of money people have wasn’t the only predictor of retirement happiness. While 75 percent of retirees who have $1 million or more are highly satisfied in retirement, so are half of those with a net worth of less than $250,000.
Didn’t diversify enough. Investors who didn’t diversify their nest egg recently learned an important investing lesson. The Consumer Reports survey found that retirees with seven or more types of investments have an average net worth of $1.4 million, compared to a net worth of $678,000 among retirement savers with three or fewer investments.
Didn’t get a job with a pension. Retirees with steady income provided by a traditional pension are significantly happier than those without one, Consumer Reports found. But workers on the verge of retirement are less likely to have a pension than current retirees. Sometimes retirees can create their own pension by buying an annuity that promises guaranteed payments for life. But only 2 percent of older workers and 1 percent of retirees name buying an annuity among the best steps they have taken toward retirement security, the study found.
Didn’t get out of debt sooner. Consumer Reports found a correlation between satisfaction in retirement and a lack of significant debt. However, 39 percent of the retirees surveyed still have at least $25,000 in mortgage debt.
Didn’t maintain healthy habits. Just over a fifth of older Americans wish they had taken better care of their health throughout their working life.
Didn’t develop lasting interests or friendships. Many retirement savers wish they had cultivated activities outside their job while working. Some seniors (19 percent) regret not developing lasting interests or friendships, Consumer Reports found. But it’s not necessarily too late to develop new hobbies or even go back to work. Twenty percent of the survey respondents work part-time in retirement, both because they need the income (37 percent) and because they enjoy the work (38 percent).