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7 Common Money Mistakes to Avoid During Retirement

Posted by David Ghiorso, CPA, February 27, 2018

When it comes to retirement planning, there are no guarantees. You probably spent years planning and saving for this next stage in your life, and you hope that your retirement income will last for the rest of your life. Hopefully, that will be the case… But some of these pitfalls can be costly. Avoid these common mistakes in retirement, and you can save yourself a lot of money and anxiety.

Overlooking unforeseen expenses. Your monthly budget might seem comfortable enough, but what about large, unforeseen expenses? It’s important to set aside some money in a savings account, to cover things like home or car repairs.

Forgetting to plan for serious illness. Most of us make a plan for our assets in the event of our death, but commonly people forget to plan for serious illness or mental incapacity. A living will and power of attorney documents can address these needs.

What about the cost of nursing care? In the event that you do become very ill, for an extended period, have you planned for the cost of long-term nursing care?

Falling victim to fraud. Con artists often target retirees, knowing that many are unfamiliar with newer ways of committing fraud (such as via online communication). Familiarize yourself with the signs of fraud, and never give out your Social Security number, bank account numbers, or other sensitive information over the telephone or email.

Loaning money to children and grandchildren. You want the best for your loved ones, which is understandable, but remember to put your retirement income needs first. Don’t loan money that you can’t afford to lose.

Failing to work with professionals. Your financial planner and/or tax accountant can point you toward money-saving opportunities, that you might overlook otherwise. Do remember to research your financial professional, to be sure he or she is certified with the proper credentials. Then, meet with them regularly, to stay on top of tax planning and other issues that can affect your income.

Overlooking Medicare options. Medicare is not a one-size-fits-all program. Even with Medicare, you will pay some amount toward doctor bills, hospital charges, prescription drugs, and other services. However, different Medicare plans offer varying types of coverage, so work closely with us to decide which Medicare plan(s) best suit your budget and healthcare needs.

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