There’s no one-size-fits-all when it comes to saving the right amount
for your golden years — which is part of what makes retirement planning so
nerve-wracking for a lot of us.
While planning for retirement
isn’t an exact science, financial experts agree on a few hard-and-fast rules
for what you shouldn’t do, according
to a recent NBC
News article:
1.
Don’t
be overly optimistic
While optimism is usually a
welcomed attribute, when it comes to retirement, a more pessimistic view may be
more appropriate. According to Tami Simpson, CFP and president of Wealth
Financial Group West, a retirement management services and financial consulting
firm in Southern California, “too much
positive thinking isn’t the best recipe for saving…a healthy dose of pessimism
is actually a good thing for your retirement planning.” plagiarize
Simpson says that some people
put off saving money because they “hope” things will simply fall into place
down the road. People imagine the best case scenarios and don’t account for
unexpected events that could occur.
2.
Don’t
underestimate your spending
Many people underestimate how
much they’ll be spending once they hit retirement. Wells Fargo financial
adviser Fay Sheppard reminds her clients that “retirees often take more
vacations, make more home improvements, and dine out more frequently than they did
before they left the workforce.”
When planning for retirement,
people need to be realistic and look at income, inflation, long-term care needs
and emergencies.
3.
Don’t
focus only on investments
According to Jeff Yeager, author
of How To Retire The Cheapskate Way: The Ultimate Cheapskate’s Guide to a
Better, Earlier, Happier Retirement, “paying off all of your debt before
you retire is as central to a good long-term plan as the size of your
retirement fund.” He believes that the greatest retirement asset is something
you don’t have: debt.
4.
Don’t
worry about being “selfish”
When it comes to preparing for
retirement, experts says we must concentrate on our own financial well-being.
This means that we stop paying for our children or helping friends or relatives.
“It’s important to leave your retirement funds intact for yourself, no matter
how hard it may seem to turn somebody down if they ask for money.”
5.
Don’t
put off your financial physical
Similar to our yearly health physical, Jack Keeter, CFS,
and president of Jack Keeter and Associates, advises that a periodic “financial
physical” is the key to a healthy retirement. He insists that everyone meet
with a financial professional before there’s a problem and review your
financial health.
References: NBC News (December 6, 2012) “5 retirement-planning mistakes to avoid”