It often feels that for one to adequately plan for the future these days, one would need the help of a crystal ball. Unfortunately, there remain a number of outdated nuggets of wisdom that cloud that crystal ball and should be forced into retirement themselves. Not adjusting for changes in the global economy can leave a gap in your financial plan that may be difficult, if not impossible to fill at a later date. We’ve found a number of these obsolete ideas that you should simply forget about.
- Old nugget #1: My Social Security benefits will take care of me. Never meant to be a primary source of income during retirement, even when implemented during the 1930’s, social security payments have steadily declined over the years and is a less-dependable income stream now than it ever was. Younger generations may even be facing a retirement where Social Security benefits no longer exist.
- Old nugget #2: I can earn less in retirement because I’ll be spending less. The idea that you’ll only need 70% – 80% of your pre-retirement income is old hat. Because of the tendency to travel more, spend more on hobbies and invest in new interests, retirees often find that they are not spending much less than they did while they were working. Though these years of increased activity do taper off as people age, it’s important to protect those funds in the meantime.
- Old nugget #3: Medicare is enough to cover me if I get sick. Medicare does what it is intended to do – it helps with medical costs for retirees – it does not cover everything. If you should have a serious health issue after retiring you may find yourself unexpectedly having to deal with deductibles and co-pays. Make sure to build a contingency into your retirement plan for added health care costs.
As financial advisors serving the Naples, FL area, the experts at Advanced Wealth Advisors offer their valued clients more helpful nuggets of retirement planning wisdom meant to gain the results for your retirement based on the goals that you have set for you and your family.