You’ve finally done it; you’ve worked all your life, and now you’re approaching your retirement. It’s time to kick back and enjoy life without the stresses and strains of work getting in your way.
However, don’t get too complacent. You might be in your 60s, but that doesn’t mean your money worries are definitely behind you. There are plenty of pits you could still fall into. Here are some of them:
Investing Like There’s No tomorrow
When you’re young, it makes sense to invest in the stock market. You have plenty of time to make up for any losses, and you probably won’t be dealing with large sums of money anyway.
When you’re in your 60s, and beyond, you can’t be quite so cavalier. You do have a lot to lose and if you invest all of the money that you’re going to need to live on very soon into a ‘sure-thing’ that turns out to be anything but, well then you’re going to be in serious trouble.
Of course, that doesn’t mean that you shouldn’t invest at all – just make sure that you don’t hold more than 60 percent of your wealth in stocks. The aim is to spread your wealth more evenly so that it is more secure.
Not Calculating Your Expenses Correctly
When you’re getting ready to move onto a more fixed income, then you need to know exactly what your incomings and outgoings are right now and what they’re likely to be when you’re retired and have much more free time on your hands. It is often the case that expenses rise when you retire due to higher life insurance and health care costs and a busier social life. You need to plan for all of these things as soon as possible so that your income doesn’t fall short.
Relying Too Heavily on Credit
There’s nothing wrong with taking advantage of the best credit card offers or taking out a loan when you really need to, but in your 60s, you should be spending a whole lot less on credit than you ever had before. After all, you’ll be giving up work soon (if you haven’t already) and having debts when your living on retirement savings is never a good idea.
Spend, Spend, Spending
When you’re younger, if you have a decent job, you can often afford to spend like there’s no tomorrow because there will be many tomorrows in which you can work to replenish your funds. When you’re in your 60s, there are fewer work days ahead of you, if any, which means a serious splurge could seriously set you back. Don’t let that happen!
Drawing Social Security Too Early
You can start collecting your social security payments when you hit the age of 62, but it’s not always the best idea because the amount you collect will increase if you wait.
I hope this helps you to stay financially savvy well into your 60s. It’s no fun being retired when you have no money to play with!
