The Consequences of Not Having a Retirement Plan
April 11, 2023
There are plenty of consequences to not having a retirement plan and you must consider all of your options as you get closer to retiring. Lack of funding leaves many elderly individuals dependent upon family or working long after they should. Although most people understand the basics of developing these funds, investments often need a better plan.
Not Having a Retirement Plan and the Trickle-Down Effect
Creating a comprehensive financial plan can ensure you have enough for your later years, but what happens if you do not plan how you should?
Working Until You Die Replaces Retirement
If you need a sound plan with adequate investment funds, making ends meet on Social Security is challenging. You might find that your lack of planning leaves you having to sustain a job for years beyond when you should have retired, sometimes even working for the rest of your life.
Credit Card Debts Accumulate
Another result of failing to create a retirement plan is the risk of excess debts. When you struggle to make ends meet, you may rely on credit cards to fill in the gaps. Those credit card bills add up quickly, leaving you with mounting debts and insufficient income to meet the demands.
Your Family Struggles Under the Stress
Without a plan for your retirement, you may have to depend on your family to support you. Many retired individuals without an adequate financial plan must move in with loved ones because they lack the financial resources to support themselves. Also, loved ones who depended on your financial planning and sound strategy to cover your debts and settle your estate after your death may face financial stress without adequate investments to meet those costs.
Downsizing Becomes a Necessity
The home you have spent decades in, and may even have paid off, could become a financial burden in your later years without adequate financial resources. Property maintenance, taxes, and insurance add up. You may face selling your home and moving into an apartment to cut costs and stretch the funds you do have.
You Might Face Irresponsible Financial Decisions
The financial challenges of an insufficient retirement strategy can leave you with choices you should not have to make. Those without adequate plans often have to sell assets, such as homes, businesses, and sentimental valuables, to qualify for Medicaid's long-term care coverage for assisted living support. Medicare does not cover long-term care, and Medicaid's eligibility is asset dependent. Decisions like these are emotional and can be challenging to make. With an adequate plan before you retire, you can establish the funds and resources needed for your long-term care without reliance on Medicaid.
You Lose the Joy of Retirement
Of the many reasons you need a retirement plan, enjoying your time is an important one. Your mental and emotional well-being depends on it; the right financial resources allow you to do that. Without the funds you need to retire, your golden years will be unnecessarily stressful.
The sooner you begin planning for retirement, the better your chances of establishing an adequate fund to make ends meet. Consider your long-term goals, current costs, and investment strategy to build the right plan for you.
About 1891 Financial Life
At 1891 Financial Life we don’t just sell policies, we offer possibilities. We pride ourselves on giving back to the communities that we serve by providing quality and comprehensive insurance solutions. We are a not-for-profit life insurance Society, which means the sales from these financial service products help fund member benefits along with social, educational, and volunteer programs designed to respond to community needs.
Our portfolio is extensive, ranging from various life insurance policies to our annuities to support your financial needs no matter what stage of life you’re in.