Interrupter CheckmarkInterrupter IconFacebookGoogle PlusInstagramGroupRamsey SolutionsTwitterYouTubeExpand MenuStoreCloseSearchExpand MenuBackStoreSign in

Investing & Retirement

Cost of Living: The Beast That's Eating Your Retirement

4 Minute Read

At first, you don’t notice it.

It inches upward undetected, silent but insistent. You don’t see the problem until it’s too big to ignore. Before long, it’s an out-of-control beast that endangers your future. And it’s a problem plaguing more than half of Americans.

It’s the cost of living.

The Biggest Obstacle to Saving

In 2016, Ramsey Solutions commissioned a survey of more than 1,000 adults to evaluate the state of retirement in America, including the things that keep people from saving for that chapter of their lives.

Here’s what we learned: No matter how old you are, the cost of living is the biggest reason you’re not saving more for retirement. Almost 60% of people in the survey said that was their biggest obstacle—and that’s true whether you’re already saving or not. For Millennials and Gen Xers, kids’ schooling and activities are also getting in the way, while medical expenses are draining the pockets of Baby Boomers.

Cost of Living vs. Lifestyle Expectations

I get it—where you live can make a huge difference in your budget. That’s why the salary for the same job can be massively different in two different states. Sometimes, though, it’s easy to confuse the cost of everyday necessities with your lifestyle expectations. Here’s how to tell if you’ve been caught in that trap.

Knowing your retirement options shouldn’t be hard. Let us help you.

1. You keep up with the Joneses. You know the Joneses—the people you try to impress by buying stuff you don’t need with money you don’t have. If you think you need a bigger house or better car because somebody else does, you’re caught in a lifestyle trap. Not good. The Joneses won’t be paying for your retirement.

2. You spend your raises. As your paycheck increases, do you use the extra to pay off debt and save for retirement? Or do you adjust your budget so you can have a bigger vacation, newer car or better wardrobe? If that’s the case, then your cost of living isn’t too high—your expectations are. The solution? When you get a pay raise, increase your retirement savings too.

3. You know every restaurant server in town. If you are on a first-name basis with the people who make your food—no matter where you get it—then there’s a problem. Cost of living isn’t the reason you’re not saving more for retirement. It’s your habit of eating out.

4. You don’t look for deals. Do you pay full price for everything? Are you unwilling to wait for a seasonal discount? Do you look for coupons or deals? If you consistently pay the retail price without looking for sales or negotiating the price, then you know your lifestyle has taken over your wallet. You could save thousands of dollars a year by looking online for the best prices and waiting for the right time to buy. Those savings could easily go toward retirement.

5. You don’t make or keep a budget. A budget tells your money where to go so you’re not left wondering where it went. If you don’t have one, you might as well be throwing your cash out the window. Spending without reason is a sure sign that you’re letting your lifestyle rule your checkbook.

6. You rent a storage unit. There are more self-storage facilities in the U.S. than McDonald’s, Subway and Jack in the Box combined! That adds up to about seven square feet of self-storage space for each person. If you’re spending money every month for space to hold stuff, then chances are you need to have a garage sale. Then you’ve got some wiggle room to put more toward retirement.

Even if your retirement account looks grim now, there’s still hope. If you make spending adjustments now and increase your savings rate, you can look toward retirement with excitement rather than fear. It’s okay to live for the moment as long as you’re saving for the future too.

For more from the retirement research report, click here.

A popular and dynamic speaker on the topics of personal finance, retirement and leadership, Chris Hogan helps people across the country develop successful strategies to manage their money, both in their personal lives and their businesses. He is the host of the Retire Inspired Podcast and the author of Retire Inspired: It’s Not an Age; It’s a Financial Number, a #1 national best seller. You can follow Chris on Twitter and Instagram at @ChrisHogan360 and online at or

Thank you!  Your guide is on its way! 

Find the Right Financial Advisor for You

Find the Right Financial Advisor for You

Ask your financial advisor the right questions with our free interview guide.

Find the Right Financial Advisor for You

Ask your financial advisor the right questions with our free interview guide.