3 Reasons You Should Stop Saving Money for Retirement

Should you stop saving money for retirement? Seriously, who in their right mind would recommend that you stop saving for retirement and do something else instead?

Well, I guess that would be me. I am in my right mind (as far as you know!) and I believe there are some very good reasons to stop retirement saving and put your money to use in other ways.

In this post I’ll show you several reasons why saving for retirement probably should not be your main focus in some situations, and what you should do instead to be financially secure so you can save more for retirement than you ever thought you could!

Retirement and Financial Security

So, why would I recommend that you stop saving for retirement? Well, there are several good reasons. You may agree with me on these or not, but the main goal is to get you thinking. Once you have the right idea about what retirement and financial security are all about, you just might decide to do things a little differently so you can get your financial house in order.

Stop Saving for Retirement if You Have a Lot of Debt

When you have a lot of debt, the result is you’re spending a lot of money on interest and fees that are draining you financially. Think about it, you’re paying extra money for debt such as:

  • Car loans (Average rate around 3%)
  • Credit card debt (Average rate of over 15%)
  • A Home equity loan (Average rate over 5%)
  • Student Loans (About 4.5–7.5%)

Debt Drains Your Finances

Whenever you have debt payments, you are paying extra money for everything you are financing. The extra fees and interest are costing you thousands of dollars every year.

The end result of all this borrowed money is that you have less money to spend at the end of the day on things that matter, including saving for retirement.

3 Reasons You Should Stop Saving for Retirement (Tweet This)

Put Off Saving for Retirement

I believe your best bet is to put off saving for retirement for a while until you can get rid of all your consumer debt. It’s best to get your house in order now instead of continually wasting money that you could save for retirement (and other things). It’s definitely better to get out of debt now and start putting that money to good use instead of sending thousand every year to creditors.

Sure, I know you think you need a car payment and a credit card and such just to get by in life. But in reality you don’t need them at all. If you really want to succeed financially you will need to get rid of them for good.

We did it, and you can do it too!

It’s really not that hard.

Here are some posts that will get you started:

How to Live Without Credit Cards- It’s Easier Than You Think!

4 Steps to Getting Rid of Car Payments Forever

Why a Home Equity Loan is a Terrible Idea

Build an Emergency Fund First

Saving money for retirement is important, but so is keeping money in reserve for an emergency. The average person can’t come up with $2,000 within 30 days if an emergency happens. If you’re not prepared for a financial emergency, it’s easy to make a bad decision and go into debt for something that you easily could have been prepared to handle.

Build your emergency fund first, and when the inevitable emergency does happen you’ll be prepared for what comes instead of taking out loans or (God forbid) dipping into retirement savings to deal with it.

Once you have your emergency fund in place, you’ll have the peace of mind to save for retirement without worrying about what may happen to derail your retirement savings in the future.

Never Retire

Saving for retirement is a wonderful thing to do. The more prepared you are for the future, the better off you will be! However, I prefer to save money to achieve financial freedom instead of saving for retirement.

What does that mean? Well, first you should understand that the notion of retirement is really a modern invention. Throughout history, man has continued to work into old age as long as he possibly could. Any physical labor he could not perform he would hand over to sons or hired hands while still doing what he could.

This had the effect of keeping the elderly contributing to society and the family instead of being a burden. In reality, man was not meant for retirement. In fact, the Hebrew language (which is the language of God) has no word for retirement.

You can find out more about it in Rabbi Lapin’s awesome book “Thou Shall Prosper- Ten Commandments for Making Money”

Financial Freedom Instead of Retirement

So my goal is not to hit retirement age so I can relax and do nothing. My goal is to save enough to achieve financial freedom to the point that I can do whatever I want.

For me that doesn’t mean playing golf 5 days a week or travelling the country in an RV. It means that I can have the ability to pursue whatever passions and dreams I choose and continue having an impact on the world.

Work at Something You Love

Just because you reach the age of 65 doesn’t mean you should stop being a productive member of society. I’m not saying you should keep working 40–60 hours a week, but I think it’s wise to continue working at something you love and can be productive at for as long as you can. I’ve seen too many people retire, then die within a couple of years because they were not engaged and productive like they once were.

Not Retiring Builds More Wealth

Also, continuing to work and be productive in some way has the effect of continuing to build wealth. Of course, the more wealth you have allows you to have more of an impact on society as well through giving and investing in worthy causes. You will also be able to leave more of a financial legacy to your family when you die.

So when you save money for the future, don’t save money for retirement. Think about saving money to achieve financial freedom and the ability to engage with the world in a productive way that makes you happy and fulfilled (actually you should be doing that long before you retire, but that’s another post for another day).

I believe that will make for a better, longer, more blessed life that has a continuing impact well into old age.


Originally published at www.cfinancialfreedom.com on March 24, 2016.

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