Top mistakes when investing in a retirement plan

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A lot of people make mistakes when investing in their retirement plan. Such an endeavor takes decades to fulfill, and small missteps can have major repercussions on your life savings. Keep in mind that every job, every deposit, every effort you put into your retirement plan leads to you having a comfortable life after your professional life. With that in mind, here are the top mistakes people make when investing in their retirement plan.


Investing on a plan with outdated assumptions

If you are working with a relatively old insurance company, be sure to make sure that you update your retirement plan using a variety of market returns assumptions. Your savings, no matter how big they are, are still subject to real-world market conditions like recessions. Even small changes in the economy can easily derail your retirement plan. Always check the computations if there is a significant change in the market.


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Retiring too soon

Early retirement is a good thing only if you can afford it. If you achieve this, but barely, your retirement may not be as smooth as you would like. It’s understandable that people don’t want to wait until they are 66 years old to retire. But keep in mind, every year you spend in retirement not working is a year your balance goes down.


Not minding the cost of health care

Health care is not cheap. In fact, out-of-pocket expenses used for healthcare purposes for retired people have jumped by over 50 percent since 2002. It’s a major risk factor in your retirement plan. If you have a medical condition that puts your savings at risk, seek a professional to adjust your plan accordingly.


Barry Bulakites is a recognized innovator in the financial services industry, having been responsible for platforms that serve the exploding retirement marketplace such as America’s IRA Centers™ and America’s Tax Solutions™. For more discussions like this, visit this page.

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