7 Things You Should Never Do When Planning For Retirement

Looking to retire comfortably? Avoid these mistakes.

ADAM MCFADDEN | Updated July 21, 2022

7 Things You Should Never Do When Planning For Retirement

Looking to retire comfortably? Avoid these mistakes.

ADAM MCFADDEN | Updated July 21, 2022

GOBankingRates maintains editorial independence. While we may receive compensation from actions taken after clicking on links within our content, no content has been supplied by any advertiser prior to publication.

It’s never too early, or too late, to start thinking about your retirement goals. No matter if you’re hoping to retire early or work until you can’t any longer, having a plan for how you can retire comfortably is essential.

Get started on these steps right now so you can reach your retirement goals.

1. Not Having A Professional Review Your Plan

If you’re fortunate enough to have plenty of retirement savings and investments, now is the time to futureproof your funds. But that takes time and skills that most don’t have, so the best option is to turn to a professional financial advisor. The hard part is finding the right one.

WiserAdvisor does all that work for you, matching you to the best financial advisor for your specific situation so you get in an expert in the areas you need.

There’s no cost to you and no obligation to hire the advisor, so there’s not much to lose.

Find the best expert for free.

2. Not Keeping An Emergency Fund

Common wisdom suggests you should keep three to six months of expenses in an emergency fund. Once you retire, however, you’ll likely want to bump up that amount. Generally speaking, accidents occur more often as you age, whether through accidental falls, reduction in driving abilities, loss of general dexterity or simply through spending more time at home rather than in an office. The best way to plan for emergency expenses in retirement is to build up your nest egg while you’re working, rather than making it a monthly line item in your budget.

Sign up for a new SoFi Checking and Savings Account today so that you can start stashing cash. You can earn a cash bonus of up to $300 with direct deposit and you can get up to 2.00% APY (Annual Percentage Yield) on all checking and savings balances with no balance cap restrictions*.

Plus, there are overdraft fees, no minimum balance fees and no monthly fees. You can even get paid up to two days early when you set up direct deposit.

Earn up to $300 now and stop paying bank fees

3. Not Thinking Outside Your 401(k)

A 401(k) retirement plan is an excellent way to save for retirement, but it does have limited investment options, so you may also want another account with more investment flexibility.

And no matter what your retirement goals look like, working with companies that understand how to invest will help you.

Vanguard’s Digital Advisor is professional money management at a low cost. They can help you invest your retirement savings so you can focus on other things. With a minimum enrollment amount of $3,000 and a cost of no more than $2 a year for every $1,000 you invest, Digital Advisor provides ongoing, automated investment management at a low cost.

With no advisory fees for the first 90 days of your enrollment, there’s no better time to get started.

4. Not Diversifying To Mitigate Risk

With a sinking economy and rising inflation, it’s important to diversify so all your investment eggs aren’t in one basket. Gold is traditionally a popular investment during a recession because it’s negatively correlated with the stock market.

Goldco offers both precious metals IRAs and direct purchases of gold and silver. It’s a top-rated company and is now offering $10,000 or more in free silver with qualified accounts.

See if you’re qualified for $1,000s in free silver

5. Not Investing Creatively

A strong way to diversify your investment may surprise you: Art. With a 13.8% return, art handily outperformed the S&P from 1995 to 2021.

Masterworks allows everyday investors to own shares of iconic works of art by the likes of Pablo Picasso, Banksy, Andy Warhol and more.

You can get paid when the painting sells or sell your shares on the secondary market, providing more liquidity than would typically be available when investing in art directly.

Sign up now to see what works of art are available to invest in, and start building your collection today

6. Not Generating Passive Income

Rental real estate is popular as an additional, passive income for the long haul. Unlike investing in stocks, real estate is somewhat shielded from the constant ups and downs of the market and has offered a return of up to 6% over time, which makes it a smart way to diversify your portfolio.

Arrived is your gateway to the world of real estate investing that’s historically required lots of upfront capital. With a minimum investment of just $100, Arrived makes real estate investing truly accessible to everyone.

It’s simple to get started: Create an account, decide how much you want to invest and watch for property appreciation and quarterly rental income payments.

Investing in real estate is a great option for anyone looking to build long-term wealth that can stand up to risk and market volatility.

Click here to become a real estate investor for as little as $100.

7. Not Lowering High-Interest Debt

High-interest debt can be a huge roadblock to building up your savings for retirement. A personal loan can help you consolidate high-interest variable-rate debt into one low fixed-rate payment. You’ll not only get a better handle on your debt, but you’ll also be able to put any savings from lowering these bills towards your retirement savings and investments.

DebtMD allows you to take back control of your finances and puts you on the path to taming high-interest credit card debt.

You can use DebtMD’s free personalized debt calculator to start working toward achieving your financial goals.

Start taking control of your debt now

8. Not Planning For Longevity

When the Transamerica Center for Retirement Studies surveyed baby boomers, 21% expected to live between 90 and 99 years and another 10% expected to live to age 100 years old or older. The thought of living so long and potentially outliving your retirement funds can be daunting, especially if your retirement savings have taken a big hit in the stock market lately.

The AgeUp annuity provides a guaranteed lifetime income if you reach your 90s that you can use however you like when you’ll likely need it most. You must be between 50-75 in order to qualify.

Sign up to make sure you plan for a long life

Do you have tips for retirement planning, or were you able to benefit from these services? Email us at Money@GOBankingRates.com and share your story. We may even choose to highlight it in a future article. Nicole Spector contributed to the reporting for this article.

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¹The introductory waiver period for Vanguard Digital Advisor’s net advisory fee begins when the first account’s enrollment is complete and ends after the close of the first billing period (generally 90 days), which is specific to each client. If you enroll additional accounts at a later date, you can still take advantage of any remaining fee-waiver period. However, each additional account you enroll won’t trigger a unique fee-waiver period but will instead be commingled with your first enrolled account. If you unenroll before your fee-waiver period ends, you won’t owe an advisory fee. But if you choose to reenroll in Vanguard Digital Advisor during or after your fee-waiver period, you won’t be eligible for a second fee waiver. This fee-waiver offer may be modified or discontinued anytime at the sole discretion of Vanguard Advisers, Inc. Accounts in employer-sponsored retirement plans aren’t eligible for this fee waiver. All costs associated with fund expense ratios still apply at all times. The fee waiver promotion is available for Vanguard Brokerage Accounts only.

*The SoFi Checking Account and the SoFi Savings Account are deposit accounts offered by SoFi Bank, N.A (“SoFi Bank”), a member of FDIC and a wholly owned subsidiary of Social Finance, Inc. Only deposit products offered by SoFi Bank are FDIC insured. We work hard to charge no account fees. With that in mind, our fee policy is subject to change at any time. We’ve partnered with Allpoint to provide you with ATM access at any of the 55,000+ ATMs within the Allpoint network. You will not be charged a fee when using an in-network ATM. Third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi Bank’s ATM policies are subject to change at our discretion at any time. SoFi members with direct deposit can earn up to 2.00% annual percentage yield (APY) interest on all account balances in their Checking and Savings accounts (including Vaults). Members without direct deposit will earn 1.00% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. Rate of 2.00% APY is current as of 08/12/2022. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. Customers that have monthly direct deposit activity into their SoFi Checking or Savings accounts will also be eligible to participate in the SoFi Money Cashback Rewards Program. The SoFi Bank World Debit Mastercard® is issued by The Bancorp Bank pursuant to a license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated. SoFi Bank does not charge foreign transaction fees when you use your SoFi Bank debit card abroad. However, Mastercard may assess a 0.20% foreign exchange fee which is not reimbursed.