Many retirees retire to find that their retirement lifestyle isn’t what they wanted from retirement. Of course, these are usually the people who enter retirement without a set plan. It could also be the kind of people who plan their retirement but make some mistakes that cost them along the way to retirement.
Here we take a look at some of the biggest mistakes that you can make in retirement so that you can avoid them and avoid living a retirement lifestyle you aren’t happy with. This is the type of advice you typically need before you retire, so you can prevent these mistakes from happening to you!
Thinking You Will Die Young
The truth is, nobody knows just how long they are really going to live. You cannot build your retirement finances and lifestyle around the expectancy that you will de young. That’s because one day you will have depleted your resources and won’t be able to live the lifestyle you intend to anymore because you didn’t die when you thought you would!
Of course, if you do die during your retirement, your financial troubles and what you needed to pay for all disappear, along with you, of course. Outliving your money is a serious risk, especially if you expect to die young and it doesn’t happen.
Forgetting the Spousal Benefits
If you and your spouse retire together, don’t forget that should one of you die before the other, the survivor will have to survive off of only one social security check. Also, not all pension funds have the joint and survivor option active. This means if you haven’t ensured that your pension fund has this option secured, your spouse may die and you won’t be receiving the proceeds any longer. Having the option secures that pension fund payments will continue for both lives.
Carrying Debt Into Retirement
Entering your retirement with debt baggage is going to mean that you will be pulling from your savings to pay off debt and wind up taking too much. Large withdrawals from retirement funds sometimes attract penalty fees or even push you higher up in the tax bracket, so it isn’t as simple as just withdrawing funds.
This sort of financial behavior increases the risk of you outliving your funds or basically running out of money for your retirement. Big debts are credit card payments, mortgages, or personal loans.
Not Planning For Long-Term Care
Too few people plan for long term care in retirement. While most people count on their partners, they forget that their partners are growing older too. The risk of requiring care increases with age. You can’t summon family and friends and rely on them at the last minute. Everyone has their plans and so should you. Plan for long term care even if you don’t think you will need it. You will have peace of mind that you have a plan in place and even if you don’t wind up needing it, it will not have been for anything.
Thinking You Will Work Longer
A survey of retired employees revealed that about 50% of those who retired wound up retiring even earlier than they expected to. Some wind up lucky with good stock markets and windfalls, but many don’t. Some lose their jobs and can’t get another for whatever reason. You could work a little longer if you haven’t saved up enough but you should rely on working longer. It is not an option that you can depend on in a y way or form.
Delaying Retirement for Too Long
You’ve been saving for your future. If you’ve been doing it right, you shouldn’t delay taking the plunge. Visit a professional financial adviser for more guidance and to secure that you can in fact retire. If you are ready, don’t delay.
Hop into retirement and enjoy the lifestyle you have been looking forward to and saving up to enjoy. Forcing yourself through work and stress will only make you grumpy and unhappy. And thus impact your health.
Retirement is a complicated thing. It is not something that’s cut in stone. So, every person’s retirement is different from the next. Decisions that you make about your lifestyle or your finances will come with consequences, either good or bad. Mistakes can be very costly. So, carefully evaluate every decision you make as it might affect your retirement lifestyle!