Did you know that you’re one of the wealthiest people in the world?
You might not think so. According to the Global Rich List, which uses World Bank data and global wealth statistics, an American earning an annual salary of $75,000 falls into the top .11 percent in the entire world. That information can certain give you a new perspective! What feels like an average lifestyle to you, is actually extravagant by comparison with the rest of the world.
But despite our relative wealth, many Americans are still technically broke, in the sense that they have accumulated little to no savings. Among households making $75,000 or more annually, one-third say they live paycheck to paycheck. And because of that lack of savings, only 37 percent of people aged 45 to 54 feel that they’re saving enough for retirement.
We can do better than this! You have the financial potential to save for retirement, but you might be falling behind due to the following factors.
You don’t know how you’re spending your money. We all have fixed expenses, such as our house payment, but many people are spending way too much on things like restaurant meals and entertainment. Check out a month’s worth of debit and credit card statements, and you will see what we mean. Then, put yourself on a budget and cut out some optional frivolous expenses.
You don’t have a plan. Most people simply earn money and spend it, without making a detailed plan for their income and expenses. When you commit to a particular budget and savings goal, you’re more likely to follow through on that plan.
You aren’t making contributions to your Thrift Savings Plan. As a federal employee, you will enjoy a retirement plan provided by the government. But because that income along with Social Security might not cover your cost of living in retirement, you should be making contributions to your Thrift Savings Plan each year.
You haven’t consulted with an expert. Most people automatically call a plumber or roofer or mechanic when something goes wrong with their home or car. But because your income is your most important asset, you should also be consulting with a financial professional. Give us a call, and we will help you analyze your budget, retirement goals, and savings. Then we can make the right decisions together, that will put your income to best use and lead to a more secure future.
