Artificially subsidized
As empty-nesters in their mid-50s, Brad and Angie look forward to retiring within a few years. Despite their relatively high income, the couple has assets worth $494,589, savings of just $2,975, and a whopping debt load of $433,105. To put this amount in perspective, the average American's total debt load is $104,215, according to the latest data from credit giant Experian.
According to a July 2023 report from the Government Accountability Office (GAO), 90% of high-income seniors have some sort of retirement balance, but the median for these households was only $605,000. Given the current cost of living, that’s not a healthy amount to retire on in most U.S. states.
Sethi believes that Brad and Angie are falling behind because “only one person is rowing the canoe.” Brad has delegated all of the family’s financial planning to Angie because she has a business degree and is good with spreadsheets.
If you find yourself in a similar boat to Brad and Angie, finding yourself off track to reaching your retirement goals, Domain Money can be an option to help get you back on track.
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Read more: Thanks to Jeff Bezos, you can now use $100 to cash in on prime real estate — without the headache of being a landlord. Here's how
Justifications
Angie’s humble background and upbringing have convinced her she “deserves” to spend her paycheck. She admitted her budget doesn’t leave much for emergencies, which is why the couple often struggles with cash flow issues. She also admitted that she’s guilty of overspending on the house and other indulgences.
While Angie does spend beyond her budget, there are ways you can leverage your daily purchases through an automated investing account that can help you save while you spend.
With Acorns, each purchase is rounded up to the nearest dollar and invests your spare change into a diversified portfolio of ETFs. To get started is simple: sign up, link your bank account, continue spending as you normally would, and let Acorns put your spare change to work.
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“I definitely feel like I deserve [to spend] because now I make a good living and I want my children to have things,” she said. However, Sethi called her out for using her kids as an excuse to overspend, calling it the “ultimate justification.”
However, this justification leads Brad and Angie into some pretty hefty debt. One way you can work towards paying down your debt quicker is through platforms like Credible.
Credible is an online marketplace that allows you to shop around for personal loans to consolidate your debt, making the process of reducing your debt less overwhelming.
By completing a brief questionnaire about your finances, Credible presents you with a selection of loans from top lenders. You can then compare and choose the option that best suits your needs — all conveniently in one place.
To salvage the situation, Sethi recommends Brad take his share of the responsibility for the family’s finances, while Angie cuts back on several indulgences so that they can start saving.
SoFi checking accounts are a secure avenue to boost your bank balances and save on fees.
With SoFi, you can earn competitive rates of 4.60% on savings balances and 0.50% on checking balances with direct deposit.
If you sign up with SoFi today, new account holders qualify for cash bonuses up to $300 by setting up direct deposit.
While the national interest rate averages a 0.58% APY, a high yield savings account can give you more competitive rates for your nest egg.
Check out our list of the Best High-Yield Savings Accounts For 2024 to find the best option for building that financial safety net.
For Brad and Angie, and Americans like them, retirement saving should be top of mind.
One solid option for building or adding to your nest is to opt for a gold IRA with the help of Goldco allows you to benefit from the tax advantages of an IRA along with the inflation-hedging properties of gold.
A gold IRA allows you to diversify your portfolio by investing directly in precious metals.
Goldco is is a trusted platform for buying precious metals, with an A+ rating from the Better Business Bureau. If you’re curious whether this is the right alternative investment, you can order a free information kit to learn more.
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