Wrong-Way Retirement Turns
Just as your GPS loses satellite and you guess wrong at a turn, losing direction on your retirement resources can also steer you off course. To keep you on the right track, here are a few common mistakes you will want to avoid:
- Not assessing your retirement dream: How much will you realistically need after retirement to lead a comfortable life? Calculate your retirement income needs and work out a plan to achieve your dream.
- Not assessing all of your financial resources: Know the difference between guaranteed and non-guaranteed income, how to get the most out of your Social Security benefits, and the tax implications of withdrawing early from a retirement account.
- Cashing out your retirement funds: Let’s say you switch jobs. If you cash out the monies in your company-sponsored retirement plan, you’ll likely pay an early withdrawal penalty. It’s usually in your best interest to either roll the money over to your new employer’s plan or move it to an Individual Retirement Account.
- How many years from retirement are you? If you are in your 20s or 30s, retirement may seem years away, but this is the perfect time to start putting money aside. You’ll have the power of time with the compound interest on your side. If you are in your 40s or 50s, don’t put it off any longer.
- DIY isn’t meant for everyone. Some do-it-yourself planners may do too little or find themselves overwhelmed and they do nothing at all. Although there are plenty of online calculators, tools and articles to learn from, consulting a trusted professional may be helpful.
If you’d like to brainstorm some options on your road to retirement, send me an email to find out what strategies might work best for you.