Retirement Planning Myths

There is no lack of information out there on retirement planning. You could spend hours trawling through all the information out there and get starting thinking you know everything there is to know. The problem is picking out the good information from the conventional ‘wisdom’. As the saying goes, where there’s plenty of information, there’s plenty of misinformation. Don’t be the one who gets caught out; here are a few of these myths debunked to make it easier for you to plan your way to a comfortable, well deserved retirement.

* Myth no. 1: Wait until later in your career to save for retirement.

While all of us would like to start saving as early as possible, many people follow the advice of those who recommend waiting until later, when everything gets easier. It sounds like a tempting offer. Why not wait until the kids are through college, the mortgage is paid off and you’re free of debt? While this would be a much easier way to save, you need to weigh up what you sacrifice for that ease. Remember you’re saving for a secure retirement. Security comes from planning your retirement from an early stage, and will give you peace of mind in the long run. As they say; time is money.

* Myth no. 2: When I retire I won’t need as much money to live on.

Can you really tell that now? Sure the kids may be standing on their own two feet. The house might even be paid off! But who knows what kind of medical and other bills may take their place. Besides, retiring isn’t about cutting back. You’ve earned it, why would you want to live on less!? Again this comes back to starting to save early, to ensure you have a comfortable amount saved for you relaxing retirement.

* Myth no. 3: I can’t afford to invest in a retirement plan yet.

Really? Think about your priorities; what is more important? That new shiny car or security in your older days. Retirement is an investment in your future. A new car will get old, whereas money invested in retirement provides you with a safety net when working is no longer an option. While many may be very tight for cash, think about where money can cut from your budget to be invested for your own good.

* Myth no. 4: My company and the government will take care of my retirement.

While this may once have been the case, its unlikely to last for much longer. The further away from retirement you are, the less I’d put my faith in my company or the government. Add the reduction in social security and company plans to increased longevity and you may find yourself being stretched for cash in your ‘would-be relaxing’ old age.

* Myth no. 5: My spouse will take care of me.

No matter how inseparable you may be, divorce and death can get in the way of that. Plus, the more independent you are the safer you will be. 

* Myth no. 6: Retirement means not working.

While retirement brings many a well deserved break, don’t rule out work completely in your plans. After 50 odd years of hard work, it’s hard to stop cold turkey. Many people go on to work part time, or even set up extremely successful businesses during retirement. On top of your savings this extra income may provide a nice cushion for you.

These are but a small selection of a huge array of myths out there. Think deeply about each piece of advice you read and look at it in terms of; is this really true? Even if it is true as of now, can things change in the future? Will this provide both comfort and security in my elder years?. If you plan right, your retirement will be a much more pleasant experience. Now get planning!