1. Not staying active socially and physically.
It is true that there are a number of retirees become reclusive after retirement. Some of them spend a lot of time in front of television should not be your social life. It’s important to maintain social connections and frequently enjoy the company of friends and family or join social groups and activities that will enable social interaction with peers. The research shows that keeping active will not only keep you mentally sharp and physical healthy, but also elevate your mood and help you be happy.
2. Moving at the wrong time.
Many people relocate based on a couple of specific factors, such as low real estate costs or low taxes, then discover that other costs more than eat up their savings. Before moving to another area, consider the place carefully and if it has hidden costs. It’s a good idea to talk to retirees who live there if it’s possible.
3. Failure to be aware of frauds and scams.
Be fraud aware as retirees are among the most targeted for scams. Consult with an advisor prior to making any investment or laying out a large amount of cash on anything.
4. Being too conservative with investments.
People always forget the risk of outliving your money, inflation risk, credit risk, so they put themselves at risk in every category except losing money. Be realistic about how long your money will be invested.
5. Supporting adult children.
It’s hard for parents to refuse their children’s requests. But you should always remember that you will no longer be earning the same money as you did when you still had a job. Your adult children can earn money to cover these expenses.
6. Underestimating medical expenses.
One of the most common mistakes is underestimating the future medical requirements. It’s hard to imagine that you might encounter some serious health problem when you are healthy. But the truth is there is a high chance that you will and this could cost your overall retirement funds. The best way is consulting with your financial advisor and make a budget plan to supplement medical care and health funds.
7. Applying for social security too early.
Many people start social security very early because it’s the fastest way for someone to increase their secure income. But if you start taking benefits at age of 62, you will get about 25% less than what you would get on your full retirement age of 66. If you haven’t started taking social security, consider these factors.
8. Keep same lifestyles after retirement.
According to the report, “among the biggest mistakes retirees make is not adjusting their expenses to their new budget dependent life.” Retirement means you are free, you have plenty of time but you are no longer earning the same amount of money. It’s time to make a budget plan based on long-term planning, and stick to it.
9. Not creating an estate plan.
If you have no idea what your life will be in 15 or 20 years, sit down and come up with several different possible plans.
10. Being over-invested in your house.
Many retirees are house-rich but cash poor. They invest their houses with almost the whole retirement accounts. It is true that house is maybe an appreciating asset but it’s also a consuming asset. It will cost you in real estate taxes, coinsurance, utilities, services and replacements, further reducing your discretionary spending.