Time To Get Out Of Your Own Way

According to a report from the US Government Accountabil­ity Office, half of Americans approaching retirement have nothing saved in a 401(k) or any other individual account. Why aren’t Americans saving for retirement? Almost everybody walks around with a mobile phone, yet so many of us don’t have enough money to save for our retirement. It’s because we don’t understand the importance of it, or, even if we do understand it’s important, we don’t make it a priority.

I am an attorney by trade, so I’m going to be the first one to tell you, stuff happens. I have focused on asset protection and estate planning for 25 years, and I know things can come up that you don’t plan for. That’s why an important part of any financial plan includes having an emergency fund, but you will also have to build in protection separately.

An example would be health insurance. If I have a catastrophic illness and I don’t have health insurance, it’s going to be a devastating situation for me finan­cially. So, I’m going to mitigate that risk by having health insurance. I am not going to add “catastrophic illness saving” in my plan, I am going to mitigate the risk with insurance. You could use a similar example when it comes to driving a car. There’s a good chance you’ll never have a car accident or if you do, it will be minor. But if you do have a serious accident that involves injury or death and you get hounded by an ambulance-chaser who tries to extort money out of you, you can reduce your risk by having insurance. This also applies to homeowner’s insurance and life insurance. You should absolutely, positively, have some sort of life insurance.

Consider the statistics.

If you live to be over sixty, you have more than a 50 percent risk of having to incur long-term care expenses—and the average cost is over $200,000. If you know that you are statistically at 50 percent risk for something, you should mitigate that risk. In this case it would involve having long-term care insurance or an appropriate life insurance product that has similar benefits for covering such expenses.

When I hear somebody say, “I don’t have enough money,” I am skeptical. I can tell you from my experience in criminal court, if a judge offers a suspect the option to leave jail by paying bail, people always manage to find money regardless of their financial position. Sometimes it’s just not a big enough priority to start saving for retirement because you would rather do other things. You’d rather go to the movies, you’d rather go out to eat twice, three times a week instead of cutting back and making it a priority. If you made retirement saving a priority and you treated it like a bill, then you could do it. This requires what I like to call a “checkup from the neck up.” It requires that you look at your own mindset instead of external circumstances you blame for not having enough money.

Other excuses I hear include “My job doesn’t offer a retirement plan.” That’s abdicating your responsibility for yourself to somebody else. Another excuse I hear is “I’m prioritizing paying down debt before I build up my asset base.” Well, that’s one I understand. I would still say you can do both. The fact is, most of the time, we are getting in our own way. You can start retirement savings today or tomorrow. You can get on that path and start getting out of your own way.