No one wants to look back with regret. But for many retirees, this is the reality.
You don’t have to be discouraged at this new time of year, but it’s helpful to hear retirees’ regrets — especially if you’re about to retire yourself.
“Despite improvements in savings and financial engagement habits, many retirees regret some of the decisions they made earlier in life when preparing for retirement,” Susan Riklin, vice president of retirement solutions at Nationwide Financial, told Yahoo Finance. “More than 8 in 10 workers over the age of 45 regret not taking into retirement savings More seriously When they were younger.”
Here are five of the biggest regrets retirees have:
Fewer than 1 in 4 retirees are very confident they can maintain a comfortable lifestyle throughout their retirement, according to a recent study. New report By the non-profit Transamerica Center for Retirement Studies.
The average estimated household savings among retirees, excluding home ownership, in this survey is just $71,000. The average estimated equity among retirees is $114,000. But 1 in 4 retirees don’t have any equity in the home.
According to the researchers, more than two-thirds of retirees wish they had saved more on a consistent basis, and half of them wish they had not waited so long to “busy themselves saving and investing for retirement.”
“Many of today’s retirees lack the awareness, knowledge, and access to resources needed to successfully prepare themselves for retirement,” Catherine Collinson, CEO and president of the Transamerica Institute, told Yahoo Finance.
“Their careers started 40, 50 or more years ago — which was long before the advent of the 401(k) and the societal imperative for people to self-fund a larger portion of their retirement income,” she said.
For many women, the deficiency stems from a late onset. research A study from Corebridge Financial found that more than 6 in 10 retired women want to start saving for retirement early — only about a quarter of them started saving and investing between the ages of 18 and 29. Worse still, about 4 in 10 retired women said they didn’t start prioritizing financial and retirement planning until age 41 or later, and 20% said they haven’t started yet.
What?!
“All of this points to the importance of saving early in your working years,” Terry Fidler, head of retirement services at Corebridge Financial, told Yahoo Finance. “This came out loud and clear in our survey. Knowing what they know now, this was the number one piece of advice retired women would give their younger selves about planning for retirement.
Nearly 3 in 10 retirees started receiving benefits at age 62, the earliest possible age, according to a new report. (Getty Creative) ·Douglas Sasha via Getty Images
One of the biggest missteps people make when it comes to Social Security is claiming too early for much fewer benefits. You can improve your odds of not outliving your savings by delaying taking Social Security benefits, which will significantly increase your monthly check for decades.
But many people don’t wait, or can’t wait. The average age at which retirees begin receiving benefits is 63, according to the Transamerica report. Nearly 3 in 10 retirees began receiving benefits at age 62, the earliest possible age, resulting in a significant reduction in benefits. Only a small percentage, 4%, of retirees waited until age 70.
Here’s how the math works. If you have the flexibility to do so Benefits of delayThe increase you get by waiting is huge. Backing off your benefits from full retirement age, or FRA — either 66 or 67 — until age 70, you get delayed retirement credits. That amounts to about an 8% annual increase in your benefits for each year until you reach age 70, when the credits stop accruing.
While there are obvious good personal reasons for claiming early, such as poor health or financial constraints, psychological distress often prompts retirees to get their checks earlier rather than later.
Perhaps the biggest factor is psychological ownership of Social Security benefits, according to Susan Shaw, a marketing professor at Cornell University.
Nearly half of retirees said debt was a stumbling block preventing them from saving for retirement, according to the Transamerica report.
Once they retire, nearly 7 in 10 report they carry outstanding credit card debt, per A reconnaissance From the Employee Benefits Research Institute (EBRI). This is up from 4 in 10 four years ago.
A third said their spending was much higher than they could afford in 2024, nearly double that of 2020 respondents.
Nearly 6 in 10 retirees are retiring sooner than planned, according to Transamerica (Getty Creative) ·WC.GI via Getty Images
Sometimes the decision to retire is one of regret. About a third of retirees regret not working longer, according to Olivia Mitchell, co-author of a paper published in the journal National Bureau of Economic Research.
The financial upside to working past traditional retirement age is clear: more years earning and saving, not having to dip into retirement savings so that money can continue to invest and grow, and having the ability to fall back on claiming Social Security.
However, sometimes the choice is right for you. More than half of those surveyed by EBRI have retired earlier than expected for reasons beyond their control, such as health issues or disability, or changes to their companies, such as downsizing, closure or reorganization.
Nearly 6 in 10 retirees retired sooner than planned, according to Transamerica. Only 1 in 5 retired early because they were financially able.
Preston Cherry, a certified financial planner, told Yahoo Finance that retirees often regret not being emotionally prepared and not having a plan for the transition into retirement and what’s next.
“These have answers to questions like: What will I do next? How will I do it? How will I readjust to hobbies and define myself?,” he said.
“They regret that it took them so long to give themselves permission to retire and then break away from the identity they had become accustomed to — whether it was their business or their corporate jobs.”
In general, retirees are happy, have close relationships with family and friends, enjoy life, have a positive outlook on aging, have a strong sense of purpose, and have an active social life.
In fact, more than 4 in 10 retirees have seen improvements in their enjoyment of life and happiness since exiting the workforce, Transamerica data found. In addition, many are spending more time with family, friends and hobbies than they expected.
More than half of retired women rate their financial health as good or very good, compared to just 38% of non-retirees, according to Corbridge’s research.
“One thing that stood out in the data was the fact that retired women are more likely to describe their financial health positively than those still in their working years,” Felder said. “Surprisingly, many women who have retired from the workforce feel more secure about their finances than women who are still earning a salary.”
The runway in front of us is different for all of us, so how to create a regret-free life is no easy endeavor.
“Retirement is a very personal thing,” Collinson said. “People retire at different ages and for different reasons.”
More retirees say surprise, they’re happier in retirement than they expected (Getty Creative) ·Tom Merton via Getty Images
How about this for 2025 intention: “Retirees who feel financial regret should create a written financial plan,” Collinson said.
Factor in living expenses, debt payments, savings and investments. Then look at how you divide your asset allocation between bonds, cash and stocks so that it’s balanced with your risk tolerance, age and goals. Review sources of guaranteed retirement income, health care needs, insurance protection, taxes, and potential need for long-term care.
And don’t forget inflation. “Many retirees have been surprised over the past few years,” she said. “We hope that inflation will come back under control, but it will always pose a potential risk to retirees and their purchasing power.”
She added that only 19% of retirees have a written plan. “But just because you’re already retired doesn’t mean you can’t do some retirement planning to figure out where you stand and give yourself a boost.”
