While sitting at dinner last week, my 8-year-old son asked me if I had made any New Year’s “revolutions”. My daughter chuckled at his vocabulary, but knowing he meant to say resolutions, I said that I wanted to eat better, read more and spend less time on my smartphone (all actual resolutions).
This is the time of year that we read the Top Ten lists of news stories, songs and movies and hear all of the things and products we can buy to make our lives easier and better for the next 365 days.
Having watched numerous commercials during the football bowl season, there are many that espouse that a new car, 0% financing on that new sleeper sofa, or a Peloton, will undoubtedly make us all better in 2020. According to U.S. News and World Report, 80% of resolutions made on January 1 will fail by mid-February. If you don’t believe me, check the parking lot at your health club this week and then look again after Valentine’s Day. You may say that you are going to finally lose ten pounds, clean out the garage or start getting serious about retirement savings, but chances are slim that you’ll follow through with it. If you must make the same resolution every year, what’s the point?
Some problems don’t require resolve, they require a revolt. This is not intended to be a political or controversial take on current events, but one on our own financial lives.
Revolution is defined as a dramatic and wide-reaching change in the way something works or is organized, or in people's ideas about it. According to the US Government Accountability Office, 48% of Americans 55 and older had put nothing away in a 401(k) or individual retirement account. The 2019 survey also states that Social Security provides most of the income for half of the households 65 and older.
Whoa! Those are some staggering numbers. If you fall into the above category, we need to talk.
If you track the findings of the Employee Benefit Research Institute, which estimated that 41% of U.S. households headed by someone age 35 to 64 are likely to run out of money in retirement, that’s a cause for a retirement revolution.
Can you live off Social Security alone in retirement?
Will your health allow you to work until you're 70?
How much money do I need to retire and more importantly, how long will it last?
All these questions can be answered and planned for. But, it takes a wide-reaching change of approach and not one of dismissal with a lack of follow through. Sometimes major problems can’t be addressed with minor changes to your behavior. This year why not resolve to be more revolutionary with your financial choices? Hiring a fiduciary advisor to help you plan this revolution will prepare you for the future.
Even though it provided a comedic moment, my son’s question was quite prophetic. What are we going to do this year to revolutionize our lives in 2020?
And when the Earth completes its revolution around the Sun in a year’s time, perhaps you’ll celebrate the anniversary of your own.