How prepared are you for retirement? Many people believe they’re making all the right moves but when retirement rolls around, they lack the necessary savings to make it through their golden years.
Everyone, but especially those near or even currently in retirement, should review their nest egg savings strategy and determine whether or not the following common mistakes need to be fixed.
Relying Too Much on Social Security
Everyone, but especially those near or even currently in retirement, should review their nest egg savings strategy and determine whether or not the following common mistakes need to be fixed. Do you think Social Security will be enough to support you in retirement? Depending on how much money you’ve accumulated over your career and the age at which you choose to retire, experts say you can’t make ends meet with Social Security alone.
While a lot can change over the course of time, getting a general impression of your benefit amount today can help you determine how much you’ll need to save and how long you’ll need to stay in the workforce. If your research indicates you’ll be coming up short, it may be time to think about working longer or taking advantage of retirement savings accounts like IRAs and employer-sponsored 401k plans if you haven’t done so already.
To find out how much monthly income you’re likely to receive from Social Security, you can visit www.ssa.gov and use their online benefits calculator.
Not Planning for Healthcare Expenses
If you plan to rely solely on Medicare to cover your healthcare expenses in retirement, you may be in for an unpleasant surprise.
First of all, Medicare isn’t free; you’ll still be responsible for paying premiums, deductibles, coinsurance and copayments. Second, Medicare doesn’t cover certain things like routine at-home care, prescription drugs and nursing home stays. Over the course of a serious illness or injury, these types of expenses can quickly drain your retirement accounts and leave you with nothing.
While it’s impossible to know every type of healthcare expense you’ll encounter, you can effectively prepare by doing the following:
- Contribute to a tax-advantaged Health Savings Account.
- Purchase supplemental prescription drug coverage.
- Investigate asset-based long-term care insurance.
Holding on to Risky Investments for Too Long
When the bottom fell out of the economy in 2008, millons of retirees across the country lost everything. The reason? Their financial advisors kept their money in risky securities-based financial vehicles. When the stock market crashed, people lost significant portions of their retirement savings.
While the current economic outlook has been fairly rosy, history has shown that stock market fluctuations can be impossible to predict and if you’re not prepared for them, you could end up watching your savings go down the drain.
If you’re concerned about the hidden risks in your portfolio, talk to a Crash Proof Retirement ® Educator about safe alternatives, that track a stock market index like Dow Jones or the S&P. If your current financial advisor is resistant to changing your investment strategy, it may be time to find a new one. Remember, you are in charge of your retirement savings.
Move Ahead and Act Today
Don’t wait until it’s too late to make these simple changes. Avoid fearing that you’ll run out of money in retirement. Your Golden Years are meant for enjoyment and relaxation. If you need more help with developing a customized financial strategy, Crash Proof Retirement ® is here for you. Maybe it’s just a matter of improving your financial literacy.
Head over to our events page and look for a Crash Proof Retirement ® Educational Event near you https://crashproofretirement.com/crash-proof-retirement-events/.
You can also tune in to the Crash Proof Retirement Show ® which airs in the Philadelphia region on Saturdays at 11 am and Sundays at 1 pm on Talk Radio 1210-WPHT and in South Florida on Sundays at 8 am on Legends 100.3 FM-WLML.
Click here to listen to our podcasts of past radio show episodes https://crashproofretirement.com/radio-show/.