Retirement Mistakes You Should Avoid

All of us eventually will retire at some point of our lives. When we hear the word “retirement” we feel mixed emotions, mostly anxiety. Some of us have plans, some don’t have an idea and some get advice from some financial advisors. But over the past years, we heard a lot of stories of people who retired early and later on in their life suffered more financially, these people already have retirement plans but why do they still have problems? Maybe, they did one of these mistakes.

Wrong Estimations

Most retirees and soon to be retirees don’t know how much income they really need when they retire. Some make big assumptions which make the whole retirement planning absolutely unattainable. But most make too low assumptions which give them a lot of troubles in the first few years of their retirement. Retirees in the first few years of retirement spend most of their money on travel, entertainment and eating. This is not bad, you should enjoy the last years of your life but you should also be mindful that health care will escalate fast in the latter years of your retirement.

There is a general rule that 80% of your annual income is the amount you approximately will need when you are retiring. But people still underestimate the total money they need when retiring, and that’s why they end up having financial problems in the later years.

Making Bets that are Foolhardy

It’s easy to be lured in chasing high returns. Putting money into the famous self-directed IRA and cashing out all your pensions are very risky. Self-directed IRA’s can hold exotic assets, which are not really advisable. The accounts you leave is totally vulnerable at risky pitches.

One event is the video of 2013 sales of Curtis De Young, founder of American Pension Services, promised to “take control of your own destiny” with a self-directed IRA.   At the end of April the same year, a lawsuit was filed by SEC which is stating that De Young placed $22 million of clients’ money to worthless real estate investments. At the end of the day, the lawyer for De Young said that clients chose the investments and the firm was only administrators.

Don’t give all your pension money to some brokers that will promise that if you give him all your money it will let you leave an inheritance. In reality if the broker has all your money he can put it in any puny investments which he doesn’t care if it would really profit as long as he gets his commission.

Failing to take Full Advantage of Retirement Plans

You must invest enough on your companies’ 401(k) plan so you can receive the full company match. This means that a certain percent of your salary must go to your contribution.  If your contribution is matched, you will have an extra incentive. If you neglect putting enough contribution, you are certainly leaving not capitalizing on your money.

Getting the Wrong Financial Advisors

We know that retiring is so confusing. Computing all these assumptions and estimations is really stressful especially if your past job doesn’t involve holding money.  The next step is getting a financial advisor, but not everyone should be trusted with taking care of your money. Some will take advantage, and that’s sadly true. That’s why you should carefully investigate the people who are giving you financial advice. Get advisors from trusted companies like guys at Paramount Business. In this way you know that your retirement will be taken care by professional and trusted advisors and you can enjoy the remaining years of your life. It’s time to call Terry Kime, your trusted CPA in Alpharetta, GA.