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February 23, 2023

4 Retirement Mistakes You Should Avoid

Knowing what not to do in retirement planning is just as important as knowing what to do!

There are a lot of moving parts when it comes to retirement planning. Know what to avoid in order to have a successful, secure retirement. Here’s a list of a few common mistakes people make when it comes to retirement planning!

Don’t wait to save.

Ever heard of the phrase ‘it’s never too early to start’? Well, it’s never too early to start planning for retirement. The biggest mistake people make when it comes to retirement is saving too late. If you prolong saving until your 30s or 40s, you’ll miss out on thousands of dollars compared to if you start in your 20s. Time is a vital factor when it comes to saving for retirement so it’s a good idea to start as soon as you’re able to!

Avoid too many unnecessary purchases.

Another mistake people make when it comes to achieving their retirement goals is making unnecessary purchases. Splurging on new furniture or taking an expensive trip somewhere tropical may sound nice in the moment, but it may derail your financial goals, especially if those types of purchases happen often. It’s easy to get carried away and make impulse buys, but spreading out bigger purchases is important. Try contributing as much as you can each month to your retirement plan in order to build savings for the future.

Don’t save without a plan.

Saving without a plan or clear strategy is setting your future self up for setbacks or failure. Creating a financial plan gives you the confidence and knowledge to make educated decisions regarding your retirement savings. Having a plan outlines exactly what you need to know to achieve your financial goals, so there are no big surprises when you’re ready to retire.

Don’t miss out on 401k matching.

Most employers offer full time employees the ability to start and contribute to a 401k. One of the biggest mistakes regarding 401k’s and retirement savings is not taking advantage of the 401k employer match. If your employer offers it, the employer match is essentially free money that you get for contributing to your 401k. If you fail to adjust your contribution limits, you could be leaving free money on the table!

There’s a lot of do’s and don’ts and even some maybe’s when it comes to retirement planning. Here at Citizens First Bank, we want to make it easy for you. If you have any questions regarding your retirement savings plan, feel free to stop in, give us a call or visit our website today!