Retirement is meant to be your time to relax, but a lot of the advice you hear doesn’t really fit real life. Maybe you’ve gotten tips from family, heard stories from a neighbor, or read advice online that just sounds off. You deserve the facts, not old myths. Here are seven popular retirement myths to be aware of.
You’ll Spend Way Less Money After You Stop Working
It sounds nice to think you’ll spend less once you retire—no commuting, no work lunches, fewer new clothes. But life can still get expensive. Medical bills pop up. Home repairs and travel can cost more than you expect. Prices keep climbing, and hobbies aren’t always cheap.
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If you count on your spending to drop, you could be surprised. It’s better to make a real budget for retirement. Give yourself extra room for rising costs and unexpected stuff.
Social Security Will Be Enough To Cover Your Needs
Counting on Social Security alone won’t pay the bills. The average check will likely only cover a portion of what you used to make. You’ll still have rent, food, medical costs, and all the usual expenses in retirement.
Social Security should be your backup, not your main plan. You’ll need savings, a pension if you have one, and maybe a little income from part-time work or investments to fill the gaps.
You Can Wait Until Late in Life To Start Saving
It’s easy to put off saving for retirement, thinking you have plenty of time. But starting early really does make a difference. Waiting even a few years can hurt your savings more than you think. Small, steady deposits now add up to more than big ones later.
Even if retirement seems far away, set up automatic savings today. Don’t hold off until you feel old—or realize your balance hasn’t grown much.
Medicare Will Cover All Your Healthcare Expenses
A lot of people think Medicare covers all your health costs, but that’s typically not the case. Many retirees still pay about $7,000 a year for care that Medicare doesn’t touch. This doesn’t include dental, hearing aids, or long-term care. The rules change each year, so you can’t count on things staying the same.
Look at what’s not covered before you retire. You may need a backup plan, a Health Savings Account, or extra savings to handle bills that pop up.
You’ll Decide When To Retire (and Will Want to Work Forever)
Many people hope to work as long as they want or pick up some extra hours for fun. But life doesn’t always let you choose your end date. Health problems, job cuts, or family needs can pull you out of work sooner than you thought. A lot of people stop working earlier than planned and wish they had saved more.
Save with a few possible retirement ages in mind, not just the one on your calendar.
Your Retirement Savings Will Last as Long as You Need
Seeing a nice retirement balance can make you feel set, but money has to last longer these days. People live into their 90s or beyond, so savings get stretched. The old rule about taking out 4% a year doesn’t always work, especially with market changes or big bills. Your costs may go up or your investments might not earn what you expect.
Check your plan every year or so. Make changes based on what you really spend and how your savings are doing—not just what you planned at the start.
Pensions (if You Have One) Are a Golden Ticket
Having a pension is a big help, but it doesn’t guarantee a smooth retirement. Some companies freeze benefits, cut back, or shift the risk to you. Pension payments may not grow with rising prices, and some plans run into money problems.
Look at your plan details and see what your payments could be down the road. Use savings, investments, or even an annuity to help fill any gaps and keep your future secure.
A Flexible, Realistic Retirement Plan
A lot of us take retirement advice at face value, even when it doesn’t quite add up. The truth is, you have to get real about what you’ll need. Start planning as soon as you can, and keep changing your plan when life throws curveballs. Use Social Security, your own savings, or pick up part-time work if you want more freedom. Expect higher health costs and make sure you have a cushion for the unexpected.
10 Reasons To Think Twice Before Retiring Early
Retiring early sounds like a dream come true, but it’s not the perfect fit for everyone. While the idea of more free time and no work sounds appealing, there are several reasons why early retirement might have some drawbacks. Here are 11 reasons why early retirement might not be for everyone. 10 Reasons To Think Twice Before Retiring Early