Three Big Mistakes in Retirement Planning
Here's a piece from Yahoo Finance that details three big mistakes in retirement planning. The article details a successful executive who made three key retirement planning mistakes during his lifetime and was now facing a rather difficult financial situation. His mistakes:
1. His first mistake had to do with probably as basic an idea in consumer finance as there is -- and likely the most frequently ignored and misunderstood. My pal Kevin, like about 40 million other Baby Boomers racing towards retirement, had not taken the time and trouble to plan for the largest possible liability -- retirement. He mostly just never thought about it.
2. The second giant mistake he made, embedded in the first, was in failing to foresee that in life, the bad scenario can and does often happen. It's not called "life" for nothing. Kevin should have realized that he would probably be the victim of age-ism, like so many of us. He planned for the most optimistic outcome, but that scenario rarely happens. It's not good to be a pessimist. It drains hope and joy from life. But it's sensible to plan for the worst and make provision for it.
3. The third mistake Kevin made -- and this is a huge one -- was to fail to educate himself or hire a finance specialist to take care of him.
The piece ends with some advice and a reality check. First, the advice:
[When it comes to retirement planning], start somewhere, start today, and get expert help.
Now, the reality check:
In a free society, we create our own destiny, and we don't want our legacy to ourselves in our old age to be one of fear. You should never have to get up in the middle of the night in a sweat about paying your bills and feeding your family and the mortgage. But it's up to you and no one else to start, and again, the ideal time is now.
What amazes me is the number of smart people who simply blow it when it comes to their personal finances. Retirement is a part of this, of course, but people blow it in lots of other very basic ways (like failing to spend less than they earn). And these are very smart people doing this! People who are high-powered, highly compensated executives in many cases. It blows my mind -- especially the "I didn't think about it" excuse. Sheeeesh!!!
But if you're reading this, you can't use that excuse. Plus, I'm going to provide some extra help. Check out these posts for more information on retiring the right way:
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