Ep 9: 5 Classic Pre-Retiree Mistakes

Everyone gets tripped up by mistakes in retirement planning and sometimes they’re unavoidable. But many times we see pre-retirees make bad decisions that hurt their financial future and they could have steered clear of these with a little assistance. Let’s look at the classic mistakes that we see before answering a few mailbag questions.

As you get closer and closer to retirement, it’s natural to feel a little more pressure about your finances and how secure you are for your future. When that happens, people without a plan or without a financial advisor are more likely to make mistakes as they do things on their own.

These classic pre-retiree missteps happen all too often and we see them with people that come into our office for the first time. We want to make you aware of the areas of financial planning where you might fall short and help you understand why each of these can damage your portfolio.

So today on The Retirement Huddle podcast, Mark Howard will take us through five of these pre-retiree mistakes. What’s great about this discussion is that it covers some of the key aspects of planning so you’ll get a wide-rage of information from the show.

Here are the mistakes that we’ll expound on during the podcast:

  • Investing at age 59 the same way you’re investing at 39.
  • Starting Social Security without a plan.
  • Focusing on tax preparation but not tax planning.
  • Assuming that most of your retirement healthcare needs will be met by Medicare.
  • Taking on additional risk to try and make up for lost time.

Hopefully none of these describe your situation, but even if they do, there are ways to adjust your planning to get back on track. If you want to go deeper into any of these areas, get in touch with us and we’ll make time to start looking through your finances.

MAILBAG

Today’s show also features three mailbag questions. The first thing we’ll talk about is what type of financial advisor makes sense for you. Should you go fee-based or with someone that charges a percentage of assets managed?

The second question comes in from a listener that is considering living off of Social Security and bank accounts for the year so that they can avoid taxes that come with IRA withdrawals. Does it make sense to draw down on your savings to save taxes or is this actually a good time to be making IRA withdrawals?

The last topic we cover from the mailbag is how much money should go into the market. Your risk should align with your age and Mark will share a simple formula that will give you a general idea of how much exposure you should have to the stock market.

Thanks for listening! We’ll be back for another show every other Thursday.

Today’s Rundown:

[0:59] – Investing at age 59 the same way you’re investing at 39.

[2:42] – Starting Social Security without a plan.

[3:58] – Focusing on tax preparation but not tax planning.

[4:57] – Assuming that most of your retirement healthcare needs will be met by Medicare.

[5:51] – Taking on additional risk to try and make up for lost time.

[6:43] – Mailbag Question: Is it better to work with an advisor that charges an hourly fee or someone who charges a management fees based on percentage of assets?

[8:08] – Mailbag Question: Is it a good idea to avoid IRA withdrawals this year and live off Social Security and bank account to avoid paying any taxes?

[9:26] – Mailbag Question: I’m nervous about how much money I have in the market. How much should I have in my 50s?

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Show Hosts

The “Coach” who will help you achieve a successful retirement future and the radio veteran who brings it all together.

Mark Howard - The Coach

Mark Howard is the President of Howard Financial Group and has more than 27 years of experience in the insurance, wealth management and financial services industry. He's also the host of the Retirement Huddle Podcast and radio show on 97.7 WTKS.

Ron Stutts - The Voice

Ron Stutts has been a professional communicator for more than 40 years. With a successful radio career that spans decades, Ron's voice has been heard on dozens of radio stations and podcasts across the country.

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