Retirement has two sides:
- Building your wealth towards a particular number, and
- Avoiding the mistakes that could set you back years
Of course, my favorite thing to cover how to build wealth with all our different moneymaking strategies and blueprints, but today I feel the need to bring up a pitfall costing hopeful retirees tens of thousands.
This could cost you years on your path to freedom…
A number of recent surveys and studies have revealed that something like 80% of parents are costing themselves up to $143,000 or more in retirement.
And quite a lot of it comes down to opportunity cost.
By this I mean that, at 45, spending $1,000 on something right now takes away your opportunity to invest that $1,000 and grow it into, say, $4,000 over time.
With that in mind, it’s time to get to a difficult truth: many parents are sacrificing tens of thousands of dollars in retirement in order to support their adult children.
Please understand that I’m absolutely NOT telling you how to parent, nor do I think every situation is the same and easily solvable.
But it’s my duty to present you with the facts and ensure that you know what your actions could be doing to your retirement dreams.
Back to the numbers…
The majority of parents surveyed by NerdWallet said they are covering, or have covered, at least some of their adult children’s expenses for:
- Health insurance – 40%
- Cell phone bills – 39%
- Car insurance – 34%
- Groceries – 56%
- Housing – 21%
- Clothing – 32%
It’s human nature to want to support your kids, no matter the cost. But I want you to step back and take stock of your situation if this is something pertaining to you.
Again, I understand that every situation is unique and comes with different challenges. And that also means that only YOU can make the decision on how much you’re willing to sacrifice for yourself in retirement.
Cutting the cord, closing the Bank of Mom and Dad, whatever you prefer to call it…
…finding a way to help your child move on to independence could mean upwards of $143,000 for YOU in retirement.
Do yourself a favor and do a little research on your options: student loans, encouraging your child to get a part-time job, insisting on scaling back…there ARE options for you, and taking action now could be the difference from taking your grandchildren to McDonalds and having to flip burgers there…