Are you thinking about retirement in the next few years? In my interview with Bill Losey in recognition of National Retirement Planning Month, I asked him:
Q: What is the single biggest mistake people make in planning their retirements?
A: In Retire in a Weekend I stated the biggest mistake is taking advice from unqualified people. You know the scenario: Your brother-in-law knows someone who is a “financial planner” or “broker,” so you go to that person because he or she is cheap and available. And you get bad advice.
That’s still a massive mistake, but a more massive mistake is not having a plan or written strategy. Many people have ideas about what they want in retirement, or how they want to handle their money, and they hear and read things and they let guesswork and emotion rule their decisions instead of having a specific spending plan and a budget and a realistic goal for their portfolio.
So my question for you is: Do you’ve a specific retirement plan? Do you know how much you need to live on during retirement? (In RIAW, Bill says most people assume they’ll need less; that’s a fallacy, because they actually need just as much or more.) Do you know what return you need to be able to maintain your lifestyle and not outlive your portfolio?
Next, not letting emotion rule your financial decisions (I’m guilty of that!)
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