4 Common Mistakes That Can Derail Your Retirement

When you close your eyes and picture your golden years, what do you see? Do you dream of fixing up an old sailboat and sailing along the coast? Sunny afternoons on the golf course? Spending more time with your grandkids? Whatever your retirement dream looks like, one of my main goals as your financial advisor is to help you achieve it.
That said, planning for retirement does take time, effort, and careful consideration. Here are four common mistakes people make that can derail your retirement plans.
1. Putting retirement saving off.
They say it's never too late to start something, and that may be true, but when it comes to saving for retirement, the sooner you start saving, the better off you'll be. While it might be hard as a young professional to visualize your life thirty or forty years from now, one of the best gifts you can give your future self is living within your means and contributing to your retirement savings early on in your career. Experts typically recommend putting 10-15% of your income towards retirement, but if you can stash away more, all the better. Thanks to compound interest, the more money you put away when you're young, the longer it has to grow.
2. Investing unwisely or not at all.
As a client of mine, you understand the importance of investing. But imagine if you didn't. Especially in our current climate of extreme inflation, it's easy to see the importance—and even the necessity—of investing. 
However, potentially just as harmful is the prospect of investing unwisely. Whether it's chasing "hot tips" or making risky investment decisions such as investing in Bitcoin, making snap investment choices is a gamble that could prove costly. I believe that portfolio management is not a static process. We seek to build a solid foundation of core long-term holdings in clients’ portfolios, in addition to looking for opportunities for clients to participate in market advancements and to be protected through market ups and downs.
3. Poor tax planning.
When's the last time you heard someone talk about taxes with enthusiasm? We get it—taxes are complex and confusing. But unfortunately, they’re something we all have to deal with. One of the most common mistakes soon-to-be-retirees make is not thinking about their tax strategy beforehand.
One especially important consideration is your tax bracket—that is, the tax rate you will be paying during your working years versus in retirement. Depending on whether you think your tax bracket will be higher or lower in retirement, there are different strategies you can use when it comes to saving for your golden years.
If you believe that your tax bracket will be higher in retirement, investing in a Roth 401(k) or Roth IRA may make sense. With these types of accounts, you will pay taxes upfront, but all of your withdrawals will be tax-free. On the other hand, if you expect to be in a lower bracket, a traditional IRA or 401(k) may be better. With these types of plans, you avoid paying high taxes on the front end and only have to pay them at the time of withdrawal. Ultimately, a careful analysis of your tax situation is essential for making informed decisions about how best to save for retirement.
4. Not seeking professional guidance.
At the end of the day, I know that financial planning is a serious undertaking, and one that shouldn't be taken lightly. With so many moving pieces to consider, it can be challenging to view your big picture financial situation and forge a path forward. Just like you might use a friend or family member as a sounding board before making a drastic life change, I act as your sounding board when it comes to those important make-or-break financial decisions. From identifying your retirement goals to putting a strategic plan in place to achieve them, I will be by your side for every step of the journey. Please feel free to get in touch with me to ensure that you're on track for retirement.
And if you've already done your retirement planning and are living out your golden years on your terms, please feel free to pass this blog along to any children or friends who might find it helpful. Like I mentioned above, it's never too early to start thinking about retirement!