Americans' Top Financial Regrets All Center on This 1 Mistake

It's natural to have regrets in life. Maybe you never had the guts to try out a new career or move to a different city. But if there's one type of regret Americans seem to possess, it's not saving enough money. In a new Bankrate survey, 56% of Americans admit that neglecting their savings in some capacity is the thing they regret the most.

For 27%, that lack of savings has to do with retirement -- or, rather, the fact that they didn't start setting money aside for it earlier in life. Meanwhile, 19% of Americans regret not saving enough for emergencies, and 10% are bemoaning the fact that they didn't save adequately for their children's education.

The good news? Rather than join the ranks of the 56% of Americans who regret not prioritizing their savings, you have a solid opportunity to learn from their mistakes and do better. Here's how.

1. Build your nest egg early on

The longer you wait to start saving for retirement, the harder it'll be to amass substantial wealth. That's because you'll lose out on the opportunity to take advantage of compounding. On the other hand, if you commit to saving for retirement in your 20s and do so consistently until you reach your 60s, you'll come out with a healthy level of savings even if you only manage to set aside a modest amount of money each month.

Check out the following table, which illustrates how much you might save over a 40-year period depending on the amount of money you're able or willing to part with each month:

Monthly Savings Amount

Total Accumulated Over 40 Years (Assumes a 7% Average Annual Return)










$1.2 million

The reason the numbers above look so impressive is because these calculations assume a 7% average yearly return on investment. That 7%, however, is a few percentage points below the stock market's average, and so it's a reasonable assumption for that long a savings window.

Of course, it'll take some lifestyle changes to free up money to save for retirement month after month. But if you're willing to cut back in one or two key areas, like rent and transportation, you could very well free up $500 a month or more. Similarly, if you're able to be more mindful of your spending in general (say, cutting back modestly across most expense categories), you might also free up a respectable amount of money for retirement purposes on an ongoing basis.

2. Have a fully loaded emergency fund

Financial emergencies can happen at any time, and without a solid emergency fund, you risk racking up debt the moment an unplanned expense pops up out of the blue. A better bet? Have three to six months' worth of living expenses socked away in the bank. This way, if your home needs a costly repair or you lose your job and stay unemployed for a period of time, you won't be forced to fall back on credit cards.

Where will that money come from? Once again, you may need to reduce some spending across the board to free up cash to put in the bank. Similarly, you might consider getting a side job to boost your earnings until your emergency fund is complete. Though the idea of working a second gig may not seem appealing to you, if you're without emergency savings, it's a worthwhile sacrifice to make on a short-term basis.

3. Save for college while your kids are young

If you begin saving for retirement early on in your career, you might easily wind up with 40 years or more to sock away money for that milestone. The problem with saving for college is that unless you begin doing so before your children are born, you generally only have an 18-year window or less to accumulate enough money to cover those tuition bills.

Still, you can increase your chances of being able to fully or mostly fund your kids' education by beginning to save when they're very young, and saving efficiently. Rather than sock funds away in a regular savings account, consider a 529 plan. Once you put money into a 529, it gets to grow tax-free so that you're not paying taxes on any investment gains you earn in that account. Your withdrawals will be tax-free as well, provided they're used for educational purposes.

How much might you manage to sock away in a 529? Assuming an average annual 7% return, you'll come away with $204,000 if you contribute $500 a month over an 18-year period. And that's not too shabby.

The last thing you want to do is look back on your financial habits and kick yourself for not being a better saver. So don't let that happen. Map out your savings goals and adjust your spending to meet them. You'll be happy you did in the long run.

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