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Respondents ranged in age from 55 to 80 and had assets ranging from $50,000 in total to $5 million, not including their home equity. The median time spent in retirement by respondents was seven years.

Overall, 70% of respondents would have advised their younger ones to change their past financial habits so they could save and invest more and start earlier.

When asked what they would have done differently to save more for retirement, respondents gave open-ended responses ranging from taking less vacation or saving less for children college education, avoiding 401(k) loans, or investing more aggressively and working more closely with a financial planner.

About half (49%) of all survey respondents said they wish they had started planning for retirement sooner.

Not surprisingly, 55% of respondents with the fewest assets (less than $500,000) were the most likely to say they wished he had started saving earlier. But a still high percentage — 40% — of those with between $500,000 and $2 million felt the same way, as did 23% of those with assets over $2 million.

The power of compounding and the power of averaging by investing small amounts consistently over time are the best things retirement savers have going for them.

The sooner they start saving, the bigger their retirement savings will be.

inflation factor

The survey was conducted between April 26 and May 8, a period in which historically high inflation had already taken hold.
What today’s retirees want future retirees to know

When asked what their biggest financial worries are today, inflation took the top spot. That’s up from the No. 4 position when respondents were asked about their top financial concerns for retirement five years before retirement.

“Rising concerns about inflation between pre-retirement and post-retirement indicate that many retirees either did not expect high rates of inflation or were not adequately prepared for them,” the researchers wrote. EBI.

And don’t forget the taxes

Taxes can be one of life’s few certainties. But in retirement, many people don’t know how much of a bite they’ll get from their various sources of income.

Almost half of survey respondents (48%) said they don’t understand how taxes will affect their finances in retirement.

And nearly 40% said they paid taxes that were different from what they expected. A majority of this group said they paid more than expected, but only 23% of all respondents said the same.

A retiree’s sources of income may include one or more of the following: Social Security benefits, pension payments, annuity payments, required minimum distributions from tax-deferred IRAs or 401(k), withdrawals taxable brokerage accounts and tax-exempt Roth IRA withdrawals.

How much you end up paying in taxes will depend on several factors, including whether the state you live in imposes income or investment taxes, or exempts Social Security benefits from tax; and whether your overall income will place you above federal taxable thresholds for Social Security benefits and capital gains.

The best advice, says Roy Goldberg, California CPA: consult a tax professional, preferably before you retire, to find tax-smart strategies when it comes to drawing income in retirement.

Make a plan

The EBRI survey found that only 4 in 10 retirees had both specified their financial goals and written a financial plan for themselves during their career. Of those who did, 65% said they worked with a financial planner.

And this group was also the least likely to say they would have changed any of their financial habits before retirement in order to be better off financially today.

Of those who said they had used a professional financial advisor, 90% said they felt the value they got from the experience outweighed the cost.

But of the group who said they had not worked with a professional, 47% said they would have benefited from speaking with a professional during their career.


Cnn

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