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Why is Saving for Retirement so Difficult?

Updated: Mar 23

In my years of experience in working with people and their finances, I have heard so many different reasons why saving for retirement is difficult or even impossible. When we have a society where 66 million Americans don’t even have emergency savings, the mention of retirement savings above and beyond an emergency fund seems like crazy talk. How did we get here? How did we arrive at a place where deferred spending (aka saving) is practically nonexistent?

Here are my thoughts— shaken, not stirred:

More is caught than taught.

Experts have been on record stating that parents should start early and speak often about financial matters with their kids. I mean— so many couples avoid talking about money like it’s the plague—who would dare talk about money with their kids, right? I believe this is a critical mistake because whether you realize it or not, your kids watch and learn from observing you. If your family didn’t discuss money growing up, it’s likely that many of your financial habits were learned from watching how your parents handled money. As a result, some kids grow up only to repeat the financial mistakes that their parents are making.

Carpe Diem

The phrase that pays…. credit card bills that is. How many small fortunes have been squandered away by the use of credit cards to finance the festivities du jour? Please do not misunderstand what I’m saying here— I fully believe that memorable life experiences can be some of the best uses of our money. However, I believe that these life events should be planned so that the experience itself serves not only as a wonderful memory but also as a reward for reaching a savings goal. “What about being spontaneous?” My response to that is—have a savings fund.

Time can be your friend or your enemy

Imagine a scenario where you started from scratch at age 25, and you were fortunate enough to work and save $10,000/year for 40 years. I know this scenario is highly unlikely these days, but stay with me here… 40 years of that savings plan would result in a grand total of $400,000 being saved out of your own funds. (this does not include any potential employer matching that may occur in an employer sponsored retirement plan)

At a mere 6% average compounded return in a tax-deferred retirement account, you should expect to have approximately $1,547,619 saved by age 65. Not bad eh? Here’s the point— you saved $400,000— which is just over 25% of the total value of the nest egg at age 65. The majority of your funds would be the result of your faith, patience, and discipline to let compounding of your investment work in your favor.

Imagine now, if you will, that you got a late start. All else being equal, you decided to start saving at 40, instead of 25. You would now be required to save $28,208/year (and experience the same investment return) to end up with $1,547,619 at age 65.

As improbable as it may be for someone to begin saving $10,000/year— imagine how unlikely it is for someone to begin saving almost 3x that amount at age 40! One note that should definitely be mentioned is the fact that participants in an employer plan that offers a match can multiply their savings efforts by participating in the plan and receiving the match.

Capturing the full match in an employer plan can be one of the most prudent financial moves you can make when saving for retirement. One thing is for certain, we all have the choice— time can be your enemy or your friend.

Get Your Big Purchases Right

When I spent some time living in Europe, I rarely saw SUVs or large trucks. Most of the people living in cities drove smaller, more economic vehicles. We Americans, however, we like our SUVs and our big pick-up trucks…and our luxury cars. Yet, one must ask about your priorities if you have a 60k SUV and no retirement savings plan. How does that make any sense?

Another area where some people overextend themselves is with a home purchase. I won’t get into the minutiae of explaining the home mortgage interest deduction; however, what I will ask you to consider is the total cost of buying a home. You should evaluate your taxes, interest, principal payments—along with the costs of insuring the home, utilities & gas bills, HOA dues, and any other expense. Housing has been the largest household expense in America for the last 75 years. Having too much of the monthly budget going to housing can seriously impede your ability to save for the future. Don’t bite off more than you can chew!


We live in a time where a large portion of our labor force is mobile. For some people, job change is more of a certainty than a possibility. When job changes happen, workers are allowed to access their funds from an employer sponsored plan. Sure, there may be a 10% penalty for early withdrawal; yet for some people, that’s a small price to pay to get access to that money they’ve been squirreling away.

Here’s a pro tip: That money is for retirement. It should stay invested.

Too many people drain their employer sponsored retirement accounts when the accounts are small. This doesn’t seem like a big deal, but consider the potential lost by always starting back at zero. Every bit counts in the long run—you can’t run a marathon if you keep shooting yourself in the foot every few miles.

Retirement saving strategies are rarely glamorous. They aren’t fun to discuss at parties, and they won’t win you the neighborhood superlative for “Most Interesting Neighbor.” However, if you stay patient and disciplined, there will come a day when you will be so very grateful that you prepared for the future. Trust me when I tell you that your future self will thank you. If you don’t have a defined savings plan, don’t waste any more time. Reach out to our team today for a free consultation about how you can get started!

Investment Advisory Services offered through AlphaStar Capital Management, LLC, a SEC Registered Investment Adviser. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability. AlphaStar Capital Management, LLC and Vertex Capital Advisors, LLC are independent entities. Insurance products and services are offered through Vertex Capital Advisors, LLC by individually licensed and appointed agents in various jurisdictions. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products offered by Vertex Capital Advisors, LLC.


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