3 Financial Mistakes To Avoid During Retirement
Don’t let the images you see on estate planning websites fool you; retirement is not fabulous or glamorous for most people, but this does not mean that you will never be able to afford to retire. The financial decisions you make now can help put you in a position to enjoy a comparable lifestyle in your golden years to what you have now. Comparable does not mean identical, however. Once you retire, your income is less than it was when you were working, but so are your expenses. Therefore, your financial decisions are different; just like when you were working, you get to make discretionary purchases when you are retired, but you also have to be cautious about your spending. To find out more about what your financial situation will be like in retirement, based on your current income and savings, and what you can do now to afford a more comfortable retirement, contact an Orlando estate planning lawyer.
Spending Like You Are Young
When you meet with an estate planning lawyer to discuss your financial future, it will be a relief to find out how many expenses you can eliminate. Many retirees choose to move from their empty nest to a smaller and less expensive house, with little or no mortgage. Likewise, if neither you nor your spouse needs to commute to work, then one car for a retired couple is usually sufficient. Houses and cars are just two of the ways that retirees can get out of the consumerism rat race that plagues so many working-aged adults.
Buying Insurance You Don’t Need and Not Buying the Insurance That You Need
Not buying the insurance you really need, such as long-term care insurance, is a major financial mistake. Retirees should also carry homeowners’ insurance and flood insurance in a hurricane-prone place like Florida. Although it is better to have too much insurance coverage than too little, many retirees waste money by paying for insurance that they don’t need. For example, you do not need a life insurance policy unless other family members depend on you, whereas life insurance is essential for anyone with minor children.
Being in Denial About Your Relationship With Your Children
Families where young adults receive some financial support from their parents are increasingly common, but most generic estate planning advice fails to account for this. You know your family better than any estate planning lawyer does. If you give your children money each month or each year, or if you pay their rent, car payments, or other expenses, treat this as a recurring expense and build it into your budget. Don’t base your retirement plans on wishful thinking that your children are just one job interview away from never asking you for money again.
Contact Gierach and Gierach About Planning for a Frugal but Comfortable Retirement
An estate planning lawyer can help you eliminate unnecessary expenses and be realistic about the unavoidable expenses so that you can retire comfortably. Contact Gierach and Gierach, P.A. in Orlando, Florida to discuss your case.