Are you worried about saving for retirement? You’re not alone. According to a recent study from Gallup, retirement is America’s top financial worry. Nearly 60 percent of Americans are worried that they won’t have enough money to retire comfortably.1
However, a study from Wells Fargo found that the answer to your retirement concerns may be as simple as changing your mindset. The study found that those who have a “planning mindset” are 42 percent less likely than those who don’t have a planning mindset to have high levels of financial stress. They also have 3.1 times more in retirement savings.2
What is a planning mindset, and how do you develop one? Below are the four key criteria identified by the study as the characteristics of those with a planning mindset. If these characteristics don’t sound familiar to you, it might be time to reassess your financial mindset.
Individuals who have a planning mindset have set a financial goal at some point in the past six months. Do you fall into that group? Have you actively pursued those goals? Were you successful?
If the answer is no, you may want to start with a modest goal. Pick something that’s achievable but also meaningful. It may be making a regular contribution to a retirement account or paying off a small credit card balance. Once you achieve those small goals, you can move on to something bigger.
Work toward long-term objectives.
Short-term goals are important, but long-term goals are also critical. Individuals with a planning mindset work toward not only short-term goals but also long-term ones.
It’s helpful to make your long-term goals as specific as possible. Don’t just say you want to retire. Instead, try to retire with a certain amount of savings by a specific date. You can then work backward to develop a plan to reach that goal.
Feel positive about your immediate future.
Stress and anxiety about short-term financial challenges make it almost impossible to focus on long-term goals. You may feel more urgency to pay off your credit cards or student loans than save for retirement.
Individuals with a planning mindset are able to focus on the long term because they’re comfortable with their financial situation over the next few years. There are steps you can take to solidify your short-term future. Perhaps you need to bolster your emergency savings. You might also benefit from using a budget. Once you feel more comfortable in the short term, you can start focusing on large long-term objectives.
Save for retirement today.
Individuals with a planning mindset know there’s no time like the present to prepare for the future. You may not be able to afford to save a sizable amount for retirement, but even a modest contribution helps. Time is the most powerful tool at your disposal. If you contribute money now, you give those funds the opportunity to grow and compound over a long period of time, which can help you accumulate more assets before retirement.
Ready to adopt a planning mindset in 2019? Let’s talk about it. Contact us today at Scott and Associates of Texas. We can help you establish goals and develop an action plan. Let’s connect soon and start the conversation.
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