4 Retirement Planning Mistakes You Need to Avoid
If you are at the age where many of your friends are saving for retirement, chances are you've already heard about how important it is. But did you know that there are also some mistakes that can be made when it comes to retirement planning?
Here are four retirement planning mistakes to avoid:
1. Investing too conservatively
Most people know that they need to save, but many don't take the time to research what investments can be made and how they work. If you do not educate yourself about investing, you could be saving for retirement in a manner that is actually very unappealing. When your money grows slowly or not at all over the course of many years, you will have less money to retire with. Taking on some risk is important, but so is being able to sleep soundly at night.
2. Not saving enough
Most retirement calculators are based on your current income and your projected lifestyle when you retire. If this lifestyle has a large gap between your current income and your projected retirement income, it's possible to run out of money even if you have invested wisely.
3. Not being able to manage your investments
There are a number of investment products available, but not all products will fit every person's needs. If you don't understand how a product works or what type of returns you can expect, you could be investing in the wrong things and not seeing a return on your investment.
4. Not taking income tax into consideration
Many people create their retirement plan using only the information available to them at the time the plan is made. Unfortunately, this doesn't take into account changes that might happen along the way such as increased tax brackets.
This happens because many people put off going to a financial planner or hiring a financial advisor to help them with their retirement planning, believing that they can do it on their own. If you find yourself in this situation and believe you wouldn’t benefit from working with a professional, make the investment in yourself and take advantage of the information provided to you.
There are many reasons to work with a financial planner, but the most important is that they can help you see beyond what you know about retirement planning and provide you with information on the whole picture. They will be able to help you determine if your assumptions on income and expenses are correct or not.
It is possible to retire without having to worry about money. You just need to take the right retirement planning mistakes into consideration and adjust your plan accordingly.
Make sure you’re making the right decisions when it comes to retirement planning. Talk to one of our Financial Advisors today to find more about our retirement savings plans in the Philippines.
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