Reaching retirement is only half the battle. Once you successfully retire, it is up to you to make sure your money lasts. Too many retirees make costly mistakes that can quickly deplete their savings and force them back into the working world.
If you want to stay retired, you need to avoid making these five mistakes.
Changing your lifestyle too quickly.
What’s on your retirement to-do list? Do you want to relocate? Purchase an RV? Travel the world? Unless you have specifically budgeted for these adventures, we’d advise you to stop and catch your breath. Waiting one year before making any major changes will give you time to adjust to your new life and avoid making a critical mistake.
Starting Social Security too early.
While you are eligible to start Social Security as early as age 62, that doesn’t mean it’s a good idea. The longer you wait to claim these benefits, the larger your paychecks will be. For example, waiting until age 66 will boost your monthly income by 25%. Waiting until age 70 adds another 32%.
Being too conservative with investments.
It’s commonly advised to shift to a more conservative investment approach as you near retirement. While this is generally good advice, it is important not to become too conservative; you still want to make your money work for you. With most bonds and CDs yielding 1% or less, retirees should keep a small portion of their money in the stock market.
Not planning for withdrawal taxes.
Every type of retirement account is different, especially when it comes to taxes. If you don’t account for this, you could end up losing more money than you need to, or worse, running out of money entirely. Your financial advisor can help you determine a withdrawal strategy that is best for you.
Failing to prepare an estate plan.
Many retirees have done a great job preparing for their own financial needs, but give little-to-no thought about what happens to their money after they pass away. Without a proper estate plan, you may not be able to transfer your wealth to your spouse or children. Click here to learn more about estate planning.
American Investment Planners, LLC offers professional financial advice to individuals across the country. Whether you need help planning to retire, staying retired, or crafting an estate plan, our consultants are here to help.
To schedule a face-to-face appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.
No comments:
Post a Comment