Retirement often means saying goodbye to the nine-to-five grind and enjoying your golden years. retirement According to the latest data, the median age for men is 65 and for women is 62. Center for Retirement Studies at Boston University. But retiring at any age requires a lot of financial planning.
Learn more: Retire Early: How much do you need to save to retire by age 40 in each state?
Find out: The surprising way to get guaranteed retirement income for life
Below are some thoughts on costs you may incur. Hold back on retirement savings.
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Dining out
For CEO Maxime Bouillon ArchieDining out was a big part of my slowly growing retirement fund. You don’t have to live the lifestyle of a hermit to retire early, but cutting back on unnecessary spending and being intentional about how you splurge are key to boosting your savings.
“Regularly eating out at restaurants or ordering takeout has impacted my retirement savings,” Bouillon says. “Though it was fun at the time, these expenses added up quickly and often exceeded my food expenses. If I had eaten out less, I could have saved hundreds, or even thousands, of dollars each year into my retirement account. On average, American families spend $3,459 a year on eating out, which could add up to a significant amount over the years if invested in retirement savings.”
By cutting back on late-night DoorDash orders and saving your food savings for birthday dinners and special occasions with family and friends, you can prioritize spending on events that create lasting memories.
Read next: 4 reasons why retired women need more money than men and what to do about it
The dopamine hit of impulse buying is real, and it can be hard to say no to good deals, little purchases, and short-term happiness, but these little splurges can sabotage your plans for early retirement.
“Impulse and wasteful purchases have taken a huge toll on my finances,” Bouillon says. “The fleeting pleasure of acquiring material things often ends up causing long-term problems. Considering that 68% of Americans confess to being impulse shoppers, it’s clear that this is a problem.”
If excessive spending is holding you back, a budgeting app can also help you track where you spend your money and limit impulse purchases, so you can cut down on excess spending without giving up on fun purchases entirely.
High interest debt
Perhaps the biggest obstacle that can shatter your retirement dreams is debt.
“Interest-bearing debt, especially from credit cards, has been a major obstacle to increasing retirement savings,” Bouillon says. “With interest rates on credit cards at around 16%, this debt burden can add up quickly and make it harder to save for retirement.”
If you have high-interest debt, pay it off as quickly as possible and your retirement and future self will thank you for it.
Unused Subscriptions
Canceling your favorite subscription services isn’t easy. From Netflix, Hulu, and Amazon Prime to your local gym membership, knowing what subscriptions you actually have is crucial to your financial stability.
“I was pretty surprised when I realized how many subscriptions I was paying for but never using,” Bouillon says. “At first, these small monthly fees seemed insignificant, but over time they added up and slowly ate away at my savings. The statistic that 20% of Americans have subscriptions they’re still paying for that they don’t use highlights how common this problem is. If I had checked my subscriptions regularly and promptly canceled services I wasn’t using, I could have saved money to plan for retirement.”
Unnecessary car expenses
When it comes to staying on top of automotive trends, the phrase “keep up with your neighbors” is more apt than ever. The upfront cost of a car is already astronomical, but not being financially smart about other vehicle maintenance costs can have serious repercussions on your retirement plans.
“The costs associated with owning a car, such as upgrades, expensive maintenance and high insurance premiums, presented an opportunity for me to save money,” Bouillon said.
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This article was originally published on GOBankingRates.com: Planning for retirement: 5 expenses I wish I’d cut back sooner
