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Most Common Pre-Retirement Planning Mistakes Baby Boomers Make

Saturday, July 31, 2010 | Posted in Promo

Most Common Pre-Retirement Planning Mistakes Baby Boomers Make

Most Common Pre-Retirement Planning Mistakes Baby Boomers Make

Just investing in a retirement plan does not guarantee that you will be financially secure at your retirement. One misstep in planning for your retirement could land the baby boomer in a heap of trouble and push your retirement back by years. To make sure that you are in the perfect position to retire when you want to, and on your own terms, diligent planning is as essential as is avoiding the most common pre-retirement planning mistakes that baby boomers make. If you make these common retirement planning mistakes, you may be headed for trouble.

  • Don’t forget to take complete advantage of your company retirement benefits, and invest as much as you can afford into your company retirement plan.
  • Don’t withdraw money from your retirement plan or you will lose valuable interest which is almost impossible to replace. Some retirement plans do allow hardship withdrawals and loans, but find out about the loss of interest, penalties and early withdrawal fees that may be involved.
  • Don’t forget to actively monitor all your investments, to keep yourself aware of discrepancies and know how well your investments are performing.
  • Don’t rely solely on Social Security to provide your entire retirement income. Back it up with other means of income such as a company pension plan and personal savings.
  • Don’t rely on your partner’s retirement plan. The partner with the retirement plan may die, divorce or have an extended illness that would end up compromising single spouse retirement plans. Make sure each person has a separate retirement plan.
  • Don’t forget to review your retirement plan on a regular basis. Review asset allocation, balances, goals, etc to make the most of your retirement plan.
  • Avoid poor asset allocation.
  • Don’t put all your investments in one stock. Diversify investments so that if one failure does not wipe out your entire retirement fund.
  • Carefully check out your broker and your financial advisor before you trust your retirement savings to them. Research credentials and track records.
  • Don’t rely heavily on your company stocks. Although it is a good way to save for your retirement, diversify your portfolio beyond company stock. A good mix of investments is essential for a good retirement account.
  • Don’t forget to take retirement planning seriously. Your retirement plan should be a priority even when you are young and at the beginning of your career. Starting early allows you to stash away a large investment and might even enable you to retire early. Think about the life style you want after retirement, and don’t postpone planning until after all your current commitments are paid for.
  • Don’t forget to figure out the numbers. There is no set formula to determine how much money you will need. The amount depends on the lifestyle you want, your current capability to save, and your investments. Roughly, to generate an income of $50,000 per year during your retirement, it is necessary to accumulate $1 million in the fund.
  • Don’t send your money to the wrong people. Retirement may seem far away, while college looms large but remember that there are other ways to help finance an education.
  • Don’t spend extra income on paring down mortgage debt. Build a nest egg instead.
  • Don’t forget to insure your savings. Long-term-care insurance is one of the most essential kinds of coverage.

In short, take your retirement planning seriously and keep your goals in sight, always. Don’t make the most common pre-retirement mistakes that baby boomers make.

For your Free Consultation, call Mike Habib at 1-877-95-IRAMD (877-954-7263).

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