Are you worried about making mistakes with retirement planning?
Retiring is a great time to enjoy life, but it can also be scary and confusing.
The average American will spend over $200,000 on retirement planning services and products before they die. That’s a lot of money that could have been used to enjoy your golden years!
With this in mind, keep reading to avoid the most common mistakes people make with their retirement savings.
1) Not Providing Enough Savings
There are not many who can make it through their entire lives without ever needing money. Sooner or later every person will experience financial hardships like loss of a job, medical emergencies, etc. Having an emergency fund is essential for this reason alone, but also because the older you get the more likely you are to run into these types of difficulties.
2) Investing Too Conservatively
Just as with anything else in life, there is risk associated with investing. Many people are too afraid to invest in riskier ventures because they may lose the money they have saved up. While it’s important to be aware of the risks involved, it’s also important not to be so conservative that you’re not able to make any progress at all.
A great way to utilize your retirement plan is by using funds to invest your money into Gold and other precious metals. This will make sure that your money is safe and only ever gaining value. See more here: https://www.raremetalblog.com/advantage-gold
3) Not Planning for Inflation
One thing that often goes unmentioned when planning for retirement and saving for retirement is inflation. Inflation is the rate at which the cost of goods and services goes up.
In order to keep from losing money over time, people need to make sure they are increasing their savings at least as fast as inflation goes up so that their long-term savings will still have the same buying power.
4) Too Much Debt
Even if you’re saving for your retirement there is no reason why you also can’t take on some extra debt. The key is not letting your debt exceed more than half the amount that you have saved towards retirement. Depending on how much debt you’re carrying, this could cause a lot of stress over the course of your lifetime.
5) Not Contributing to an IRA or 401k
One last mistake that many people make with retirement planning is not contributing enough money to either an IRA or a company-sponsored 401k. For example, if you’re 25 years old today, and are set to retire at 65, then you have 40 years between now and then.
6) Failing to Update Your Plan
Retirement planning is not a one-time event. It’s something that needs to be revisited and updated on a regular basis as your life changes. For example, if you get married you will need to revise your plan to account for the fact that you will now have two incomes to work with instead of just one.
Want Help Avoiding Mistakes With Retirement Planning?
Whether you’re just starting to save for retirement or are close to retiring, it’s important that you don’t make any of these 6 mistakes with retirement planning. If so far your retirement planning has been limited, now is the time to start making changes. The sooner you get started the better off your future self will be!
If you’d like to learn more about common retirement challenges and long-term care costs, check out our blog for more help with your retirement plan. You can also contact us with any questions about your specific situation – we’re happy to help!