There is a lot of information about retirement planning available from many different sources. With so much conflicting advice, it’s easy to fall prey to deceitful offers. But how can you separate the good from the bad to make sure you’re making the right decisions for your future?
Ultimately, the choices you make for your retirement savings plan depend on your personal objectives, such as whether you plan to move to an assisted living center or you’d prefer to age in place. But regardless of your goals, there are a few dangerous retirement savings mistakes everyone should avoid.
The top four retirement savings mistakes include:
Mistake No. 1: Poor Asset Allocation
There are several different options for allocating your assets—from stocks and bonds to cash equivalents—and how you choose to invest your retirement savings can have a big impact on your future comfort. Ideally, your asset allocation will strike a balance between conservative and aggressive investing so you’ll be able to adjust your savings as you get closer to your retirement years.
Mistake No. 2: Not Considering Long-Term Needs
It’s impossible to know what the future holds. However, as uncertain as your long-term care needs may be, you can make sure you’re prepared. In addition to failing to take healthcare needs into consideration, many people also underestimate their life expectancy. In the case of your retirement savings, the best course of action is to over-plan and over-save; that way, you’ll be prepared for whatever comes your way.
Mistake No. 3: Overestimating When You’ll Stop Working
While we’re discussing things you can’t exactly plan for, many older adults make the mistake of assuming they’ll be able to continue working longer than health requirements or other life events allow. Just like life expectancy and long-term care needs, it’s best to plan for more than you may need. That way, even if you can continue working for as long as you like, you’re still prepared for all of life’s uncertainties.
Mistake No. 4: Not Consulting a Professional
Retirement savings plans are overwhelming, but there’s no reason you have to go through the process alone. By consulting a professional financial adviser —ideally one who has experience working with older adults and retirement plans—you can rest assured you’re doing everything possible. Plus, meeting with a professional can help you avoid making other less common mistakes that may not have made this list.
Your retirement should be a time of relaxation and reward after years of hard work. Don’t let retirement savings mistakes take away from what you’ve earned. By planning ahead and taking precautions, you can avoid these four common pitfalls.
Your retirement is all about you—and that means making your own choices. Discover how retirees like you are making big changes. Get a free copy of Aging in Place: A Popular Trend for a New Generation of Seniors.
