Ramit Sethi: 5 Money Moves Smart Couples Never Do After Age 50
Written by
Diana Kelly Levey
Edited by
Zuri Anderson
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By the time we hit midlife, most of us have it all figured out, right? Not necessarily.
According to a 2024 AARP survey 1 in 5 Americans over age 50 have no retirement savings and more than half of those surveyed worried they wouldn’t have enough money to last throughout retirement. On top of that, over 80% of Americans don’t have an emergency savings, a Kashable report revealed.
You might want to give pause before you look to all of the older Americans in your circle for financial advice. Luckily, there’s Ramit Sethi, author of “Money for Couples,” who addresses common challenges couples have with money in his new book.
If you and your partner want to be a smart money couple that others can look up to, follow these strategies that wise couples over 50 never do with their finances.
They Don’t Go into Debt Without Weighing the Consequences
Some people make a carefully-considered decision to leverage low-interest debt to buy something they can technically pay for while paying the minimum and investing the difference, Sethi said.
“But… realistically more people just go into debt and get trapped,” he concluded.
Sethi suggested this guideline before you take on a loan: “Avoid all debt except a mortgage and car loan. And for those two, carefully calculate how much it will actually cost you.”
They Don’t Pay Their Adult Children’s Expenses When They Can’t Afford It
In a recent episode on Sethi’s YouTube channel and podcast, “Money for Couples,” one of the guests is still paying for her adult children’s cell phones even though they have moved out of her home and she doesn’t have enough saved for her retirement.
“I hear too many parents who still pay for their kids’ college tuitions, cell phones or even rent — while they themselves don’t have enough for retirement,” said Sethi. “Your kids have time to save. You have far less. Before you spend thousands on them, be sure you have enough to retire.”
They Don’t Pay a Portfolio Percentage Fee to a Financial Advisor
There are certain times where you may want to consult a financial advisor for a complex financial situation, a large portfolio or you’re approaching retirement — just to name a few examples — which is fine, Sethi said.
“I’ve personally hired an advisor to review my asset allocation. But never, ever pay a percentage of your portfolio in fees (also called AUM),” the money expert explained. “A 1% fee can cost you 28% of your lifetime returns in fees. Instead, look for hourly or project fees.”
They Never Miss Employee Matching for 401(k) Plans or Other Investing Options
If your employer offers a 401(k) match, that is free money you could be leaving on the table. Sethi said, “Take advantage of it! It can be worth hundreds of thousands of dollars to you.”
Get in touch with your company’s human resources department to better understand the details of the company’s retirement offerings and match.
They Never Forget That Money Should Be Enjoyed
“The point of money is not to save it,” said Sethi. “It’s to use it to live a ‘Rich Life.’ That means building the skills of earning money, managing money, and — crucially — spending money on the things you love.”
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