Save for retirement and avoid these realities!

Save for retirement so you won’t be like 56% of Americans who lose sleep thinking about retirement.

The average Social Security benefit check was $1,340 per month in 2019. No matter how you look at it, in most parts of the U.S., trying to live on $16,080 per person per year in retirement is virtually impossible.

Saving money is not nearly as fun as spending it, but NOT saving money from each paycheck will have some pretty serious consequences.  In today’s blog, we will talk through the 6 Harsh Consequences not saving for retirement creates for you.

 

1. If You don’t save for retirement, you’ll be Unprepared for Emergencies

One of the consequences of not saving any money is that you’ll be financially unprepared to deal with any unexpected emergencies that occur.

For example, what if your hot water heater fails and it costs $10,000 to get it fixed? What if your car breaks down and it’s going to cost $1500 to fix?  If you don’t have any money saved, you’ll have to go into debt to pay for this.

Unexpected and unfortunate things happen in life, while they might not all cost you money – some of them will and you need to be prepared for that.

 

2. You Will Go Into Debt

The biggest consequence of not saving any money is that amassing debt will be inevitable for you.  Going into debt is almost like a by-product of not saving money. Heck, it’s hard enough to stay out of debt for those who do save money.

Consumer debt carries the highest interest rates depending on the type of credit you used to make the purchase. But regardless of the interest rate, using borrowed money to pay for things that aren’t assets is usually a bad idea.

You might find yourself in serious consumer debt if you don’t save any money and just keep borrowing.  This can get very psychologically deflating as whatever money you do earn in the future is just used to service your debt payments. – it’s like a revolving door of debt.  This is a vicious cycle that’s incredibly hard to get out of.

3. Unable to Fund Major Life Events

Not saving any money can have huge ramifications when it comes time to fund major life events like weddings, family vacations, or home ownership – just to name a few.

Remember this, the more you save now, the more you’ll have to spend later.  Short-term sacrifice for long-term gains.  Imagine being able to pay for your children’s weddings. How much joy would that bring you?

On the contrary, going into debt to fund these big moments may result in you resenting your children for the stress and financial hole they’ve caused.

 

4. Save for retirement or there’ll be No Inheritance Money For Loved Ones

Morbid thought, I know. But hey, we are all going to die at some point, and leaving your loved ones with an inheritance is always a nice thing to be able to do.

The value of an inheritance goes much deeper than just the financial aspect of it. People that inherit money from their loved ones often use this money on something sentimental.

Not only is this a nice surprise during a difficult time, but if the money is spent wisely, it can help loved ones remember you and the legacy you’ve (hopefully) left behind.

If things get really bad and you die with a lot of debt, your loved ones will, unfortunately, be on the hook for this as well. Not to mention things like funerals and burial costs. Pleasant thought I know.

Let’s move on before we all start to cry.

5. Save for retirement or else You Will Always Have to Work

A major consequence of not saving any money is that it makes you completely dependent on your income. You will have to work until the day you die if you wish to maintain your current lifestyle. Who wants to do that? That sounds absolutely terrible.

I see it every day, the elder generation working at Walmart when they should be relaxing in their golden years!!

6. No Peace of Mind

Not saving money can lead to a lot of negative outcomes as mentioned above. While mostly financially related, not all repercussions are directly related to money.

The emotional effects of debt can be quite severe.  Going into debt can trigger some pretty serious emotional feelings such as anger, stress, and depression.

Increased stress levels can lead to serious physical health issues such as a higher risk of heart attack, high blood sugars, insomnia, and headaches.  At the end of the day, we all just want a good night’s sleep, don’t we?

The emotional and physical effects that debt can cause are just one of the many reasons why you should save money.  If debt doesn’t negatively impact your emotional state directly, then you’re a stronger person than most, but you should still stay away from borrowed money as much as possible.

Final Thoughts

Not saving money can have serious consequences. Whether it’s the debt, the lack of freedom or the emotional pain it puts you in, not saving money is not, I repeat is not a good idea.

If you take one thing from this article, make it be this. Despite what you might think, saving money will actually make you happier. 

Not only will you not feel the emotional effects of debt, but you’ll be excited about what your future holds knowing that your financial situation is looking bright.

So, even if you are living paycheck to paycheck and say “Fred, I just can’t save for retirement”.  Wrong!  Check out our tips to save for retirement, even if you live paycheck to paycheck.

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