Mistakes made during the working years:
- Not maximizing company match programs and not saving enough
- Taking a loan from your retirement plan or cashing out
- Not diversifying your investments to match your risk tolerance
- Not revisiting and balancing your portfolio
- Fear to take action
- Not planning for health care cost prior to 65
- Going into retirement before you can afford to
- Retiring without a retirement road-map
Errors people make in retirement:
- Not adjusting to living on a fixed income
- Not accounting for inflation. Potentially live 30 plus years in retirement. A 3% average inflation over that time can eat into your lunch.
- Overestimating income and underestimating expenses. Standard is 80%, but could be more due to entertainment and travel.
- No equity, going too conservative. The older approach of 80/20 or the age formula has changed as people are living longer in retirement and need to have growth in their portfolio.
- Applying for Social Security too early
- Not working with a retirement financial advisor