Retirement Pitfalls
November 18, 2011 By Law Office of Michael Robinson, P.C.
Retirement planning in any economy is a challenge, and people can make mistakes if they choose to go it alone. We discuss five common errors that are made by many in retirement planning.
1. Relying on the unreliable.
Many rely on an inheritance or windfall to help them in their later years. With people living longer and spending more than ever to meet long term care needs, families are spending their assets at record rates, leaving little to pass along to their children.
2. Planning too little, too late.
It is hard to imagine retirement needs when you are just beginning in the workforce, but this is the time to start planning. Not only should you start planning, but keep planning as your life changes. Retirement plans should evolve and be reviewed on a regular basis.
3. Not taking advantage of tax savings and employer matching contributions.
Most employers that offer a retirement plan will match your contribution up to a certain limit. For instance, your employer may match the first 2% of salary you contribute. If you contribute less than 2%, you are literally throwing away free money.
4. Failing to update beneficiaries to reflect your current wishes
You may be leaving your assets to someone who is already deceased or no longer a part of your life. Review beneficiaries not only for retirement plans, but for life insurance as well, particularly when life changes, such as marriage, divorce or the birth of a child, occur.
5. Failing to plan for medical expenses and a longer life expectancy.
Many retirement planners stopped planning for retirement expenses after the age of 85, but as life expectancies increase, so should retirement plans. Medical expenses and long term care expenses can easily burn through hundreds of thousands of dollars, particularly since employers are eliminating retiree health benefits, and you can't get Medicare coverage until you're 65. Even then, there are plenty of costs the government program doesn't cover.
Work with an estate planning attorney to avoid retirement planning pitfalls and to build a cohesive, comprehensive estate plan, they are able to educate you on tax reduction techniques for your situation, and interpret complicated income tax rules and IRS regulations.
ABOUT THE AUTHOR: Michael Robinson
Experienced estate planning attorneys Naples NY of the Law Office of Michael Robinson P.C. offers estate planning and business planning resources to residents of Naples NY.
Copyright Law Office of Michael Robinson, P.C.
More information about Law Office of Michael Robinson, P.C.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
Many rely on an inheritance or windfall to help them in their later years. With people living longer and spending more than ever to meet long term care needs, families are spending their assets at record rates, leaving little to pass along to their children.
2. Planning too little, too late.
It is hard to imagine retirement needs when you are just beginning in the workforce, but this is the time to start planning. Not only should you start planning, but keep planning as your life changes. Retirement plans should evolve and be reviewed on a regular basis.
3. Not taking advantage of tax savings and employer matching contributions.
Most employers that offer a retirement plan will match your contribution up to a certain limit. For instance, your employer may match the first 2% of salary you contribute. If you contribute less than 2%, you are literally throwing away free money.
4. Failing to update beneficiaries to reflect your current wishes
You may be leaving your assets to someone who is already deceased or no longer a part of your life. Review beneficiaries not only for retirement plans, but for life insurance as well, particularly when life changes, such as marriage, divorce or the birth of a child, occur.
5. Failing to plan for medical expenses and a longer life expectancy.
Many retirement planners stopped planning for retirement expenses after the age of 85, but as life expectancies increase, so should retirement plans. Medical expenses and long term care expenses can easily burn through hundreds of thousands of dollars, particularly since employers are eliminating retiree health benefits, and you can't get Medicare coverage until you're 65. Even then, there are plenty of costs the government program doesn't cover.
Work with an estate planning attorney to avoid retirement planning pitfalls and to build a cohesive, comprehensive estate plan, they are able to educate you on tax reduction techniques for your situation, and interpret complicated income tax rules and IRS regulations.
ABOUT THE AUTHOR: Michael Robinson
Experienced estate planning attorneys Naples NY of the Law Office of Michael Robinson P.C. offers estate planning and business planning resources to residents of Naples NY.
Copyright Law Office of Michael Robinson, P.C.
More information about Law Office of Michael Robinson, P.C.
View all articles published by Law Office of Michael Robinson, P.C.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
