No one ever wants to look back in regret. But for many retirees, that's the reality.
Not to be poor at this new start time of year, but it's helpful to hear the regrets of retirees – especially if you're closing in on retirement yourself.
“Despite improvements in savings habits and financial engagement, many retirees regret some of the decisions they made earlier in life in preparing for retirement,” Suzanne Ricklin, vice president of retirement solutions at Nationwide Financial, told Yahoo! Finance. “More than 8 in 10 workers over 45 regret not taking retirement savings more serious when they were younger.”
Here are five retirees' biggest regrets:
Fewer than 1 in 4 retirees are very confident that they will be able to maintain a comfortable lifestyle throughout their retirement, according to new report by the nonprofit Transamerica Center for Retirement Studies.
The estimated median household savings among retirees, excluding home equity, in this survey is just $71,000. The median home equity among retirees is estimated at $114,000. But 1 in 4 retirees have no home equity.
More than two-thirds of retirees wish they had saved more and consistently – and half wish they hadn't waited so long “to worry about saving and investing for retirement, ” according to the researchers.
“Many of today's retirees lacked the awareness, knowledge and access to resources needed to successfully prepare themselves for retirement,” said Catherine Collinson, CEO and president of the Transamerica Foundation. , to Yahoo Finance.
“Their careers began 40 or 50 or more years ago—which was long before the advent of 401(k)s and the social imperative for people to self-fund a larger portion of their retirement income,” he said.
For many women, the deficiency results from a late onset. Research by Corebridge Financial found that more than 6 in 10 female retirees wish they had started saving for retirement earlier – only around a quarter of them started saving and investing between the ages of 18 and 29. Worse yet, around 4 in 10 retired women say they didn't start prioritizing their financial and retirement planning until 41 or later, and 20% said they still haven't started.
What?!
“All of this highlights the importance of saving early in your working years,” Terri Fiedler, president of retirement services at Corebridge Financial, told Yahoo Finance. “This came through loud and clear in our survey. Knowing what they know now, this is the No. 1 advice retired women would give themselves for retirement planning.”
Almost 3 in 10 retirees started receiving benefits at age 62, the earliest possible age, according to a new report. (Getty Creative) ·Douglas Sacha via Getty Images
One of the biggest gaffes people make when it comes to Social Security is claiming a much lower benefit too early. You can improve your chances of not spending more than your savings by delaying taking Social Security benefits, which will significantly increase your monthly check for decades.
But many people don't – or can't – wait. The median age when retirees began receiving benefits is 63, according to the Transamerica report. Almost 3 in 10 retirees started receiving benefits at age 62, which is the earliest possible age, resulting in a much smaller benefit. Only a small proportion, 4%, of those who retired stayed until the age of 70.
This is how math works. If you have the flexibility to delayed benefitsthe progress you get by waiting is significant. Pushing back to tap your benefits from your full retirement age, or FRA — either 66 or 67 — until age 70, you earn deferred retirement credits. Those come to an annual increase of around 8% per year in your benefit for each year until you reach 70, when the credits stop accruing.
While there are obviously good personal reasons for claiming early, such as poor health or financial constraints, the psychological pull is often what pushes retirees to cash their checks sooner rather than later.
Perhaps the biggest factor is the psychological ownership of one's Social Security benefits, according to Suzanne Shu, 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.
And after they retire, nearly 7 in 10 say they have unpaid credit card debt, per a survey by the Employee Benefits Research Institute (EBRI). That's up from 4 in 10 four years ago.
And a third said their spending was much higher than they can afford in 2024, almost double the respondents from 2020.
Nearly 6 in 10 retired early, according to Transamerica (Getty Creative) ·WC.GI via Getty Images
Sometimes the decision to retire is regrettable. Around a third of retirees regretted not working longer, according to Olivia Mitchell, co-author of a paper published in the National Bureau of Economic Research.
The financial upside of working beyond the traditional retirement age is clear: more years of earning and saving, no need to dip into retirement savings so those funds can continue to be invested and grow, and have the ability to push back to claim Social Security.
Sometimes, however, the choice is made for you. More than half of those surveyed by EBRI retired earlier than expected due to reasons beyond their control, such as health or disability problems, or changes in their company, such as downsizing, closure or reorganisation.
Nearly 6 in 10 retirees retired earlier than expected, according to Transamerica. Only 1 in 5 retired early because they were financially able.
Retirees typically regret not preparing emotionally and having a plan for the transition to retirement and what's next, certified financial planner Preston Cherry told Yahoo Finance.
“These get answers to questions like: What am I going to do next? How am I going to do it? How am I going to get back to hobbies and know myself?” he said.
“They regret that it took them so long to give them permission to retire, and then pull the plug on an identity they're familiar with – whether it's a business or a corporate job.”
Retirees are generally happy, have close relationships with family and friends, enjoy life, have a positive outlook on ageing, have a strong sense of purpose, and have a life socially active.
In fact, more than 4 in 10 retirees have experienced improvements in their enjoyment of life and happiness since they stepped out of the workforce, Transamerica data found. In addition, many actually spend more time with family and friends and pursue hobbies than they would expect.
Over half of retired women consider their financial health to be good or very good, compared to just 38% of non-retirees, according to Corebridge research.
“One thing that stood out in the data was that retired women were more likely to describe their financial health positively than those still in their working years,” said Fielder. “Surprisingly, many women who have retired from the workforce seem to feel more secure about their money than women who are still earning a paycheck.”
The runway ahead is different for each of us, so how to create a life without regrets is not a cookie-cutter endeavor.
“Retirement is deeply personal,” 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 a 2025 intention: “Retirees with financial worries should create a written financial plan,” says Collinson.
Factor in living costs, debt repayment, savings and investments. Then look at how your asset allocation is split between bonds, cash and stocks so it's balanced for your risk tolerance, age and goals. Review sources of guaranteed retirement income, health care needs, insurance protections, taxes, and the potential need for long-term care.
And don't forget inflation,” he said. “Hopefully, inflation is back under control, but it will always pose a potential risk to retirees and their purchasing power.”
Only 19% of retirees have a written plan, he added. “But just because you're already retired doesn't mean you can't do some retirement planning to know where you stand and give yourself a boost.”
