Retirement Plan: Some Common Mistakes to Avoid – Part 2

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The previous post discusses some mistakes that need to avoid in your retirement plan if you want to have a peaceful days after retiring. They include avoiding retiring too early, claiming social security benefits too early, or expecting to work long after you retire. In other words, you need to anticipate anything that may affect your financial security after retiring.

More Mistakes to Avoid in Retirement Plan

There will be a time when you do cannot work any longer. Therefore, basing your living expenses upon a part time job is not a choice. Make sure to avoid the following mistakes in your retirement plan, as suggested by Steve Vernon, a Forbes contributor:

Medicare is The only Insurance

Some people falsely think that Medicare is like any other types of insurance, which they enjoy while working. Indeed, Medicare is called medical insurance, however, do not assume that it is the only health insurance you need when you retire. In fact, you need to know some facts on Medicare:

retirement plan 2

  • It has significant deductibles
  • Medicare has some co-payments
  • It does not cover health services, which are covered by the employers. Examples include dental care or vision

In other words, you may need to buy a health insurance policy to supplement the existing Medicare. Consult your financial adviser to choose the right insurance that fits your need for the rest of your life.

Assuming You Won’t Move After Retiring

You may feel comfortable living in the house you are living in now, right? When it comes to retirement plan, you still need to anticipate any possibility for moving after you retire. You will have some reasons to consider moving. Why? Most of retirees are trying to cut the living expenses after retiring. If you live in the downtown or near to a business center, the living expenses may be too high with your retirement benefits.

Many people cut back the expenses by stopping going out for  eating or cutting their cable TV. However, there will be a case, in which these are not enough to close the gap between your living expenses and retirement income. So, if you are looking for the largest part in the living expenses, housing will be the answer. Therefore, you may decide to move to a place, where you can have a peaceful life in your retirement days. Make sure to anticipate this, also.

Fantasizing Only about Vacation

Never think that retirement is only about vacationing to exotic locations or walking peacefully on the beach. In fact, those activities will account for only few weeks of the year. What about the remaining weeks? You will probably spend most of time at home. Besides planning the ‘vacation’ time, you actually need more careful planning for the ‘real life’ as it accounts for the largest part of your time.

The point is that mistakes in the retirement plan may block your retirement days. Therefore, make sure to think about what daily life you will have after retiring. This is the time to work on your retirement plan. Careful planning will provide you with a peaceful life after retiring.

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