What I’ve Been Up To

This Week in Your Wallet: Simplicity in Retirement, Low Credit Scores & Money Stress

“It’s the simple things in life” is a phrase many of us have heard before — and a concept that’s easy to lose sight of. Although if you’re letting your retirement planning (or the fear that you’re not going to be able to achieve the level of savings you need) get the best of your emotions, then looking to the simple things might be the key to finding peace of mind.

As The New York Times reports, new research in The Journal of Consumer Research says older people often draw as much happiness from the ordinary as they do the extraordinary. For example, a walk in the park can bring as much satisfaction as a cruise to the Caribbean. How does saving for retirement relate to this?

If you haven’t saved enough — or have had to use retirement savings to cover college or emergencies — these findings offer hope. You can stop stressing over those costly items you perhaps thought were key to retirement happiness like traveling the world, buying a second home or living in a different country. According to this study they’re not necessary. If you can cover the simple things in life, like basic expenses, and pursue inexpensive daily activities that fulfill you, you’ll find plenty of happiness. It can be as simple as that. For more on the research, head here.

And while we’re on this subject, a different piece of research says there are physical and emotional benefits to owning a pet – especially for older people. Pets provide affection, entertainment and purpose – as well as some other benefits that may not come as quickly to mind, according to USA TODAY.

For example? Science says we draw comfort from touch. If you’re alone, then having a companion nearby, like a dog or a cat, can satisfy this basic need. Pets will motivate you to get moving, because Fido isn’t going to walk himself. This can help with weight management and overall physical well-being. Pets can also help you relax. Research says the act of petting an animal will lower your blood pressure. (I can’t confirm this, because I haven’t put on a cuff and tested it, but I can tell you that having Teddy by my side at the end of a hard day does seem to relax me.) Plus, gerontologists (those who study the social, psychological and biological aspects of aging) say having to keep your pet on a schedule, will help you do the same for yourself. Read on here.

Why the low score?

Consumer Action research says that 27 percent of Americans have never – never! — checked their credit reports. Why? According to DailyFinance, many people don’t understand credit. That makes pulling a report both intimidating and complicated. Avoidance is a coping mechanism. Trouble is (especially with data breaches on the rise) it’s dangerous. Get on the right track by requesting your free credit report once a year from each of the three major credit bureaus (Equifax, Experian and TransUnion) at annualcreditreport.com. For a free score, go to SavvyMoney.com.

If your score is lower than you’d like (720 or above is where you want to be), double-check your personal information (i.e. name, home address, where you’ve worked and your Social Security number). Mistakes are common and fairly easy to fix; just use the website of the credit bureau to ask for the edit. Also, be aware that simply paying off your credit card in full every month may not be enough for score success. You need to watch your balances too. If you carry a high balance compared to your limits (i.e. it exceeds 30 percent of your available credit) then it can lower your score. And finally, be sure to pay all bills on time. Even one or two late payments can be a significant drag on your score.

Money stress and your job

If money is stressing you out, then it’s likely affecting your life both at home and at work. That’s not necessarily a good thing for your employer either. As I wrote in Fortune this week, more than one in five employees said they had taken a day off work for reasons of financial stress, according to a 2012 study from MetLife. Nearly one-third of Gen Xers spend a solid three hours a week thinking about or dealing with their finances, according to research by PricewaterhouseCoopers.

These findings go a long way to explaining why 75 percent of 400 large companies surveyed by benefits consulting firm Aon Hewitt are planning to focus more on financial wellness this year. To learn more about what you’re likely to be offered, check out my column here.

Have a great week,

Jean