The 11 Biggest Retirement Lies We Tell Ourselves

Laura Shin

8. I need to get my kids through college first and then I can focus on my retirement.

Yes, college is a big expense, and you should definitely save for it. But if you don’t save the full amount for college, you can always fall back on financial aid. Grants, scholarships and student loans can help pay your child’s way. (Learn here how best to save for your child’s college education and learn to open a college savings account with this checklist.)

When it comes to your retirement, however, there are no loans. All you’ll have to live on is what you’ve saved. For that reason, saving for retirement should be your top financial priority–always. Any leftover money you have can go toward college savings. (Find out here how to prioritize retirement against your other financial goals.)

9. I am going to lose money so why invest it in a 401(k) or IRA?

Yes, the market is not reliable from year to year. But, historically, over long periods of time, it has returned about a 7% annual return on investments. You’re not going to get that with a savings account–and, in fact, you won’t even beat inflation if you stash your money in a savings account.

10. I’ll start saving when the market improves.

No one can predict the market. No one. So you cannot time your investments perfectly so that they only ever go up. But if you invest regularly over decades, your investments, like the general stock market has done historically, should experience more ups than downs. So, invest for the long haul, and don’t fret over minor dips now. If you do, you’ll be missing out on amassing tens of thousands of dollars later.

11. I plan to keep working even during retirement.

According to the Chase/LearnVest study, 17% of women believe they can do this (as do 14% of men). You may love your work, and it may be the kind of work you can do even when you’re less spry. But what if you can’t find work, or what if you have health problems that prevent you from working?

While you can hope for a best-case scenario, it isn’t wise to base your plan around one. Sock away some money now so you’re ready for whatever may come your way. Even if you’re healthy enough to work past the typical retirement age, you’ll probably want a vacation now and then!

No More Excuses

If you’re fully convinced to let go of all these retirement lies, take our Retiring in Style Bootcamp. In ten days, you’ll visualize your future retirement, learn what accounts you need, find out the total amount you need to save and more.

  • Elissa Backas

    Ha ha, my husband will be relying on me when we retire :P My 401K is in pretty good shape and I’m only 27. Yay me. Of course one day, all hell could break loose and the dollar may be worth nothing in which case all of us responsible people will look awfully silly, but we’ll have bigger problems to deal with than that. Or aliens, aliens could invade.

  • Ana

    It’s especially hard to save enough in different retirement “baskets”. I have a pension and a 457 and a ROTH and I’d like to contribute more to the ROTH because that seems a little more secure than the stock market but it’s hard coming up with enough extra to save in the ROTH on top of a 457 and pension. 

    • Rima

      I’m in the same boat Ana.  Although we are lucky to have these problems as its rare to have a pension in this day and age.

  • Natalie

    That’s easy to say, but raising my son takes precedence. Between daycare and rent/mortgage, there’s not much left. Single parents -especially those who don’t get help from the absent parent – make due without for the sake of their children. However, this article is very well written and includes much practical information. I will certainly keep many of these points in mind as the years progress. Thank you.

  • Frank

    I like the phrase – ‘a man is not a plan’ …

    • Daniel

      A man, a plan, a canal. Panama!

  • Vonetta

    It’s hard for me to consider having kids, even though I’m 38 and the clock is ticking. Right now, it’s hard enough taking care of myself, paying off student loans, debt and saving for retirement while also having some money left to go out and you know, actually have a social life. So I can find the elusive Mr. Right, get married and have the aforementioned kids! Can’t imagine saving for retirement and college tuition. Hope my future offspring study hard and get a scholarship.

    • Casggp

       I’m right there with you Vonetta and wonder if it’s even a choice for me now.  I’m 36 and stopped working when my father unexpectedly passed away to keep the family together.  My “Mr. Right” changed his mind about having kids along the way and didn’t tell me for years.  Now I’m looking for a job and a new relationship, but I think the clock may have timed out on me.  I personally feel that I should be stable in both arenas before even having kids….but stability isn’t happening soon.  As this rate, I might  have have to choose saving for retirement over having kids.

      • Vonetta

        I guess it’s comforting to know that others are in the same boat. It’s just the reality for many of us. For me, it was a combo of not finding the right guy and being careful not to get pregnant and becoming a single mother. Having a kid is not ideal when I’m trying to get myself together and stay afloat after years of making smart decisions (like going to college and having roommates to save on rent) and not so smart decisions (taking a low-paying job and living off of credit cards when getting laid-off and buying things I couldn’t afford). Hopefully, the next decade will bring many good things and things will fall into place. 

    • Vicky

      56, married to 61 and thinking about retirement. Can’t imagine why people are going for the right wing rhetoric that is resulting is lowering benefits for SS and medicare. People brag about having $74k in 401k funds! What, are you kidding! Our system is not working, and all of you out there better start spending less on worthless junk and start saving! Ths idea that you can keep working is a dream too! Once you’re pushed out of that good job, the only places that will take you are Walmart and Home Depot!

  • uhhuh

    The tone in #1 kind of bugs me. Maybe I’m just not the intended audience here–but then, why am I receiving these emails? In any case, I actually DON’T have $20/week (married with three kids and pinching every penny already). And we already pack our damn lunches. I think it’s the assumption that we don’t that bugs. :P Full disclosure, we do have SOME retirement savings, just not enough and it’s hard to imagine where that money is going to come from.

  • johndogsan

    41 years old with $500,000 in retirement savings. Lived below my means and maxed out my 401k. I do not spend money on $5 Starbucks or other “luxuries” that I could make in my home for 0.25 cents. I’m going to retire at 59 with plenty of money to travel. The key is drawing up a budget, making a plan, and sticking to it.

    • Chicago

      Amen. I’m right there with you I just have to work until 62. So far my plan has worked for us very well. We plan for the worse and pray for the best. Good plans go a long way.

    • Julie Pham

      Do you have kids?

      • bob

        great question. why isn’t this a central part of the dialog, given the investment each child requires?