By: Colleen Weber
News and Updates
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You’ve probably heard the saying “Hindsight is 20/20.” Well, this is especially true when it comes to retirement. Many people are entering retirement and discovering several things they wish they’d done differently. Luckily, you can avoid problems in your own retirement by learning from the mistakes of the millions of people who have gone before you. Here are the top four regrets in retirement.
Waiting Too Long To Start Investing
One of the biggest regrets retirees have is they wish they would’ve started investing at a younger age. Most of us understand the basics of the power of compound interest over long periods of time, yet we fail to put it into practice. Why? Because it will be decades before you collect on the benefits. Instant gratification (e.g., that new car) is much more exciting. Avoiding this popular regret requires great self-discipline and a delayed gratification mindset. But when you enter retirement and see your account is several times larger than those who waited to start saving, it will all be worth it.
Drawing From Social Security Too Early
You’ve been paying into the Social Security system your entire life. And once that money is finally available to you, it’s natural to want to touch it as soon as possible. However, good things come to those who wait. If you start drawing from Social Security at your first opportunity (age 62), your monthly payments will be over 30% less than if you wait. The right time to start drawing is unique for every person, but just remember: the longer you wait, the larger your payments will be.
Waiting Too Long To Retire
On the other hand, another common regret is waiting too long. If you have enough money saved away (a financial planner can help determine this), you should consider retiring as soon as possible. The younger you are when you retire, the more energy and health you’ll have to actually enjoy retirement. Many retirees regret spending their best retirement years grinding away at work. Sure, they had more money when they finally did retire, but they had less time to enjoy it.
Forgetting About The Non-Financial Aspects Of Retirement Planning
When it comes to retirement planning, a common mistake is to only focus on the financial side of things. Not only should you plan to have enough money, but you also need to plan what you are going to do with your time. Most people find their self-identity in their careers, and when their career ends, they don’t know what to do; they lose their feeling of purpose. So, retirement isn’t just about leaving your job. It’s about moving on to something else. What is that something going to be? It could be travel, hobbies, volunteering, etc. The important thing is to determine what your next purpose is going to be.
As you can see, there’s a lot more that goes into planning a happy retirement than simply saving a portion of your income each month. It’s a complex process with many factors unique to your personal situation. This short list of retirement regrets just scratches the surface of the things most retirees wish they’d done differently. In order to avoid these regrets, the smartest thing you can do today is to get in touch with a financial planner. These experts help people plan for retirement every day and will make sure you’re not forgetting anything important. If you’re interested in speaking with a professional financial planner who can help create a plan to give you peace of mind about your retirement, click here to book a free introductory meeting online!
Colleen Weber is a fee-only financial advisor, CERTIFIED FINANCIAL PLANNER™ professional, and CPA with more than 15 years of financial planning experience. Providing comprehensive financial planning and wealth management, she specializes in serving clients nearing retirement, retirees, busy professionals, and women. She is passionate about developing financial plans that save clients on taxes, and investment strategies that help them pursue their goals. Learn more about Colleen by connecting with her on LinkedIn or booking a complimentary phone call meeting.