Retirement Planning - Ten Common Mistakes Baby Boomers Make Planning For Retirement

Just investing in a retirement plan does not guarantee that you will be financially secure at your retirement. One mistake in planning for your retirement could land a 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 heading 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 or divorce or have an extended illness that would end up compromising on the 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.

Don't put all your investments in one stock. Diversify investments so that 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 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.

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Retirement Planning Mistakes You Need to Avoid Making

Are you ready to start planning and preparing for your retirement? If so, congratulations you are making a step in the right direction. The earlier you start planning for your retirement, the better off you will be when the time comes.

The decision to start planning and preparing for retirement is a wise decision. As previously stated, the earlier you start, the better. With that said, the earlier you start planning for retirement the more mistakes you are likely to make. These mistakes, a few of which are outlined below, can cause financial problems and more when you are ready to retire.

Not creating a budget for yourself and not tracking your spending are two mistakes that you will want to avoid making. This often leads to you spending more money than you have. You should be saving for retirement, especially at around the age of forty, not getting into debt. For that reason, never spend money that you do not have and never spend all of your money. It is best, but a must when you reach the age of forty, to start paying for all of your purchases with cash, checks, or debit cards. Before doing so, however, make sure that you have enough money to spend and keeping on saving for retirement.

Another common mistake that people make, when creating a retirement plan, involves not taking health into consideration. Health and the impact it can have on your retirement can work two different ways. For starters, what if you get sick? Can you afford the cost of emergency surgery or long-term medical care? Even if you are healthy now, remember that your health can always take a turn for the worse. It is also important to note advancements in medical technology. Many men and women are living longer than they originally planned for. You do not want to run out of retirement money just because you lived longer than expected.

In keeping with your health and wellbeing, it is important to examine your spouse and visa versa. There is a good chance that one of you will live longer than the other and possibly a significant amount of time longer. Make sure that you have enough money to retire on your own, in the event that your spouse passes away. It is also important to recheck all important documents. Make sure your will, mortgage, and all property deeds are in order and designed to protect the surviving spouse.

Relying too much on government assistance, like social security, is a mistake that many make. This is a mistake that can be damaging to you. Did you know that social security will only pay for portion of your retirement needs? On average, it only covers about 40% of your needs. What plan do you have for the other 60%? If you do not have a plan, now is the time to develop one.

The biggest mistake that many individuals make is dipping into their retirement funds before they are ready to retire. This is a huge mistake that can have a negative impact on your retirement and your finances in the future. You should never take money from your retirement funds, unless it is a dire emergency. Use your retirement savings as a last resort. If you need cash quickly, consider approaching your local bank or speaking to friends or family members to acquire small loans.

Not knowing all of your saving options is another mistake that you will want to avoid making. Did you know that there are multiple ways that you can save money for retirement? There are, for example, a 401(k) program, as well as Individual Retirement Accounts (IRAs). There are also many others who use stock and bonds to save extra money for retirement. In fact, it is advised that you spread out your retirement savings to offer you protection. Do the proper amount of research online or schedule an appointment with a financial advisor before it is too late.

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Top 3 Financial Mistakes Newlyweds Make! (And Married Couples Too)

Your wedding day is finally here and it is perfect (or as close as possible). You are off on your honeymoon with your sweetheart and the both of you have a wonderful time. Over the next few weeks and months the two of you settle in to your new life.

There are conversations related to many topics but one that weighs very heavily on the scale is the topic of money. As newlyweds there are a multitude of financial decisions to be made. It would be a list that would take more room than we have here today to discuss. But there are some topics that rise to the top, some things that should not be put off.

Actually there are three major financial mistakes that many newlyweds make. By the way if you are not a newlywed keep reading because these money mistakes are not only for newlyweds. There are many married couples that I have worked with that after five, ten, and even twenty years of marriage they have not addressed these issues.

Saving vs. Spending - I know it is very easy to go out with your friends and spend, spend, spend but you need to consider the alternative. How about saving some of that money for your future? I can hear the questions forming in your brain as I am typing this "Why would I want to worry about money now, there is plenty of time for that later? It is very easy to get caught up in "keeping up with the Joneses". It can also be a very costly proposition. Spend, spend. Spend is not a habit you want to get started off with. Start budgeting early on in your marriage. There is nothing wrong with going out and having fun. Just set aside a certain amount every month for play time and once it is spent you are done until next month.

Retirement Savings - Most young people (not just couples) wait too long to start saving for retirement. If you are working for a company that has a 401k, 503b or any other type of retirement plan where they match a portion of your contribution you should take full advantage of that. If you have a retirement plan still with a previous employer you should consider taking it out and putting it in your own IRA type plan. You will not be penalized for this if done properly. Talk to your tax professional or the brokerage firm you want to move it to and they will tell you what you need to do to avoid penalties and taxes on this money. If you don't have a retirement plan at work then you should put as much into an IRA as possible (up to the limits of the law).

Set up a Will - I know we all want to think that we will live forever but the truth is that we won't. Wills are fairly inexpensive to do if you use an attorney. They can also be done online for much less and with the same quality you would get sitting with an attorney in person. It doesn't matter how you do it just that you do it.

There you have it now go ahead and get started.

Strategy Based Profits TIP: - Start setting money aside for savings, maximize your retirement plan and set up your will sooner rather than later.

Robert J. Roy

Money Man

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Top 5 Retirement Planning Mistakes

Most of us don't have the time or the perspective to check whether our retirement plan going to stand the test of time. Here are some common mistakes that people make and it may be prudent for you to check the numbers on these to make sure you are on the right track.

1. Not having Long Term Care insurance: To many peoples' surprise, this is mistake number one. The reason it is so is that this one mistake can wipe out your entire nest egg in one fell swoop regardless of how well you have planned every other aspect of your retirement plan. Even faster if both you and your spouse were to need care in any given year. It's literally like building a castle out of sand. For the money, this one insurance product buys more of not just financial but mental security than any other investment. Of course, there are situations when this is not true, depending on your income and net worth, so check with your financial professional.

2. Being too conservative: it is easy to understand why a lot of us prefer to be conservative in these brutal markets but this is also the biggest mistake we can make unless we have enough money to cover all our income needs far into the future, counting for inflation. Our biggest task is keeping up with inflation and we cannot do the job adequately unless we keep a healthy slug of our portfolio in stocks.

3. Not counting social security as a bond investment in asset allocation: when you retire, you will get a fixed income from social security just like a CD or a bond. Same thing with a pension. When you allocate your assets, count these sources of income as "bonds" or "fixed income".

4. You need 70 percent of your current income for retirement: this is almost always wrong because most retirees spend more than they did when they were working, at least in the first few years of retirement. You need to look closely at your monthly expenses after retirement but it makes a lot more sense to aim at replacing your entire pre-retirement income if not more. Do you care if your overshoot your goals?

5. Assume you will be in a lower tax bracket after retirement: This may hit you with higher tax bills than you expected when you pay tax on your IRA and 401(k) withdrawals. You need to look at your expected tax bracket every year, specially if you are near the mandatory distribution age of 70 1/2.

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