The average retirement age is around 65 years. This doesn’t mean that your life ends there, in fact, according to the National Institute on Aging in America, you can expect to live another 17 to 20 years. This a enough time to travel, have fun with family and friends, enjoy some of your hobbies. On the downside, it can mean being stressed about all your expenses.
The secret is to plan well and at the right time to enjoy your later years in peace. It is normal to make mistakes, more so when it comes to planning for your retirement. If this is the case, it’s never too late to make necessary adjustments.
Let’s look at some of the common mistakes made during retirement planning and how to overcome them.
1. Saving Too Little
A report in 2013 by the Boston College Center for Retirement Research, the retirement fund for 55 to64 year olds has a median paltry of $111,000. This means living on $400 per month and this is quite minimal if you are to survive for 17 to 20 years. It is then important for you to start saving now and consequently increase the savings as your income increases, or when you have very little responsibilities.
2. Saving Too Late
As you are reading this, it might be already late to be able to save up some good amount for retirement. However, it isn’t all gloom and doom, one solution is to stay in the workforce for longer. This will enable to not only save a significant amount, but also increase your benefits on your Social Security.
If you can’t find work, then look for lawful income generating projects like business or investing in shares and bonds.
3. Retirements Means End of Planning
It’s been the common thinking that retirement plans that you made will run itself after you retire. That retirement now means just relaxing and enjoying the fruits of your youth. But the reality is that a plan can only be relevant it constantly reviewed to conform to the changing market conditions and the goals of the retiree. Many do not even consider that inflation rate can go up as well medical expenses.
The solution therefore is to consult a good financial adviser to help you look at your assets, income and taxes comparing them to the market conditions.
4. Rate of Return
It is very tempting to put all your money in a certain investment or fund that performed really well over the years. This is because you a solely looking at your rates of return,. However, advisers caution people that it may have gone well in the past, but, due to unforeseen circumstances the same fund might do very badly. The solution is to spread your investments on various kinds of funds that considers your goal and the appropriate risk for your age.
These mistakes can dearly cost you happiness during your retirement, but experts have said that there is always an opportunity to make the correct changes. Remember that retirement is a planning process and never stops. So don’t let this vital information stop with you, share it with family and friends, especially those who might be making some of these mistake, on Facebook, Twitter and other social media platforms.
- Adams Media Corporation
- Emily Guy Birken
- Publisher: Adams Media
- Suze Orman
- Publisher: Hay House Inc.
- Hardcover: 320 pages
- Larry Swedroe, Kevin Grogan
- Publisher: Harriman House
- Edition no. 1 (01/07/2019)
Last update on 2020-03-19 / Affiliate links / Images from Amazon Product Advertising API
Helpful article? Leave us a quick comment below.
And please give this article a rating and/or share it within your social networks.