- Grown Kids draining your retirement account – Everyone’s wishing that their children succeed in life. And when they come to ask for help, it’s rather impossible to even think to turn them down. Even so, experts are advising you not to share too much of your retirement money with your adult kids.
- Having a bigger home than you need – An oversized home can be troublesome from a financial point of view. Especially for those who are currently focusing on saving for retirement. We asked a financial advisor what the best thing we can do is, and the answer was exactly what we expected. While it’s understandable why you would want to keep a bigger house in the middle of the pandemic, where you can wake up the next day in a new lockdown, an oversized home can become a liability too. You’d have to keep up with all the costs and property taxes.
- Paying mortgage in retirement – If you don’t have gigantic mortgage payments, keeping that large property shouldn’t be any problem for you. But if you pay tons of money and you barely succeed in saving for your retirement nest egg, you should definitely consider selling your overpriced property and purchase something that’s more affordable.
- Giving too much away, and too early – If you successfully saved a lot of cash, you might be tempted to give some away. Whether you’re doing it out of joy or not, you should think twice before deciding. On the one hand, those who give away to charity have some serious tax benefits waiting for them. On the other hand, if you give away too soon, you might risk outliving it.
- Big medical expenses – Saving up to live peacefully during your golden years is difficult enough as it is, let alone having to pay for healthcare. According to “Fidelity Investments” and their annual retiree healthcare cost estimate, senior couples in their mid-60s might spend up to $280,000 on medical expenses during their retirement. Personal finance writer Elizabeth Colegrove explains how “large, debilitating medical expenses can harm your savings”. The best thing to do is to think ahead and contribute to a health savings account whenever you have the chance.
