Securing your retirement future will take sacrifice. And not just the financial sacrifice of prudently saving for it over a number of years.
You should practice frugality and fight the impulse to waste money impulsively throughout your retirement.
As human beings, though, we usually waste money without knowing it.
The hard truth is that to secure your retirement future, you may have to learn to sacrifice a lot of conveniences you took for granted in working life.
Here are four things you should sacrifice now to secure your retirement future.
New vehicles
The average American drives the same car for anywhere between 7 years to 12 years before getting a new one.
However, you must put money in a car for it to operate. The average annual maintenance costs to own a full-size sedan is $8,550. Car maintenance costs include gas, insurance, repairs, and so on.
Since the average cost of a new vehicle is $40,000, you could cut that cost by half and more by investing in a used car if you want a new vehicle.
If you already own a vehicle, you should compare the costs of upgrading against getting a new one.
Your retirement fund should pay for your post-working lifestyle, not to maintain your vehicle.
And cognitive ability begins declining incrementally as we age. Ask yourself how much you will drive in your 70s and 80s before investing in a new car before you retire.
Plus, do you need two (or three) cars?
Whether you are retired alone or with a spouse, think of what you can do with the money you gain by selling a second and third car than paying for multiple annual maintenance fees in retirement.
Store-bought coffee
An undeniable mark of maturity is taking a leisurely stroll and buying a cup of coffee at a neighborhood barista.
Unfortunately, you will waste a lot of money doing this at the expense of your retirement account.
The average price of a cup of coffee at a brand-name coffeehouse ranges between $2.76 to $4 per cup. Look at it this way — if you buy a $4 cup of corporate brand coffee three times a week for a year then you just spent $624 on coffee.
Buy a nice coffee machine and brew at home. Get a good thermos so you can have coffee on the go. Home-brewed coffee costs $0.74 per cup.
Big home costs
Homeownership is an identity for many Americans. Owning a large home for years or decades can even become to feel like a birthright you may want to pass down generations.
It’s just a house. And more than 33,700 homes were foreclosed upon in the first quarter of 2021.
Begin saving by downsizing to a smaller house or consider renting if that means you can save money for retirement.
Brand-name products
When you buy brand-name consumer goods or prescription drugs, you are paying as much for the brand name as the product. You will find all of the same ingredients in generic versions of the same product.
You can save more than $1,000 annually by buying generic food products at the supermarket.
And you can save thousands annually by buying generic prescription drugs whenever possible.
