Avoiding Common Errors

Understanding the past helps clarify the mistakes of the present. When navigating your retirement planning today, sidestep these frequent missteps:

• Relying exclusively on the government: Social Security was designed as social insurance to prevent poverty, not to fund a luxurious lifestyle. Assuming it will cover all your expenses often leads to drastic, forced lifestyle cuts later in life.
• Ignoring long-term care costs: In the past, family members provided free, around-the-clock nursing care. Today, families are geographically scattered, and adult children usually maintain full-time careers. Failing to plan for the cost of home health aides or assisted living can rapidly drain a well-funded portfolio.
• Retiring with high debt: Historical retirees slashed their expenses because they had to. Entering retirement with credit card debt or massive auto loans forces you to withdraw more heavily from your savings, exposing you to unnecessary sequence-of-returns risk in the stock market.