You may be in your 50s and thinking and planning hard for your retirement. Saving larger amounts is a key ingredient of all that planning. But there could be many an obstacle that comes in the way of building up an adequate corpus for retirement. While you may be conscious of some of them and some may be too obvious, it may still be useful to review the possibilities that are hurting your retirement plans. In the extract below of the author’s extensive list, you could be surprised by some, which may even be happening to you without your realisation. Check them out. Team RetyrSmart
Things that could be threatening your retirement
Grown Kids Siphoning Off Your Retirement Money
Most people want to help their children succeed in life. Experts caution against sharing too much of your retirement money with adult kids, however. Teach your kids to be independent — they will likely thank you in the end.
Keeping Too Much House
An oversized house can be a serious financial burden for individuals trying to save for retirement. A house that’s too large for your needs can become a liability, between upkeep costs and property taxes.
Giving Too Much Away, Too Early
If you have extra cash, you might be tempted to give some away to family members or a favourite charity. But individuals need to be mindful of timing. People who give their money away too early risk outliving it.
Being Part of the Sandwich Generation
Members of the sandwich generation, aspiring retirees often find themselves caring for both adult children and aging parents. Instead of saving for holidays, vacations and larger expenses, your resources are spent on the older and younger generations.
The Myth of Spending Less in Retirement
Many individuals assume that they will spend significantly less money in retirement than they do during their working lives. This is usually a mistake because other expenses may increase, such as travel and healthcare costs.
In an era of pension and Social Security crises, employees must take greater control of their financial destiny by contributing more to their 401k.
Having Inadequate Life Insurance
Paying too little for life insurance now can affect your family’s plans in retirement. Life insurance gives breadwinners the peace of mind that comes with knowing surviving spouses will be protected after they’re gone. When saving for retirement, don’t forget to invest sufficiently in this necessity.
Ignoring the Impact of Inflation
Inflation is a major threat to your retirement. It’s a hidden tax on savings. You have no control over it, it can’t be predicted and it has erosive effect. Stay abreast of inflation costs to avoid unpleasant surprises down the line.
For instance, putting your money in a well-performing mutual fund in the belief that it will continue to climb higher is a perilous choice that is often based on wishful thinking. In the long run, making financial decisions based on bad assumptions and misinformation can result in negative outcomes and keep you from enjoying the retirement of your dreams.
Neglecting Your Own Needs
Many aspiring retirees focus on the needs of others instead of their own self-interest. For example, when you loan money to family members or borrow for your kids’ education, you’re tying up precious funds that could be invested toward your future.
Soon-to-be retirees need to be conscious of their spending habits and avoid buying more than they can afford. This can be a huge threat to someone’s retirement, because it can cause people to buy stuff based on their income as it increases, instead of putting more of it toward their retirement