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Crazy Retirement Myths that Could

Cost YouKnow which retirement myths could end up costing you big time: http://peerfinance101.com/2015/04/crazy-retirement-myths-cost-you/

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There’s so much uncertainty around planning your financial future that it’s natural people would cling to retirement myths and rules of thumb guesstimates. Between not really being able to know what rate of return you’ll get to not knowing how much you’ll really need, people build in a kinds of assumptions to help them sleep at night.

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Many assumptions and rules are ok, like saving at least 10% of your income and maxing out 401k match plans. Other assumptions and myths could end up putting you off track. Some of these retirement myths and assumptions are so pervasive that they’re accepted as truth without any thought.

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Retirement Myth #1: You’ll Need 80% of Your Pre-Retirement IncomePeople 75 years and older spent just 68% ($35,000) of the amount spent by the younger group. That means, while you may spend about 80% when you first retire, you’ll likely spend much less as you get older.The things you’ll spend money on will obviously change and you own situation will differ depending on your lifestyle.

You may choose to eat out more frequently May pay less for repairs if you rent instead of own your home. You likely won’t have to save for retirement or pay payroll or social

security taxes.

Realistic Retirement Planning: http://peerfinance101.com/2015/02/realistic-retirement-planning/

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Retirement Myth #2: Social Security will pick up the tab

People started thinking about social security as a plan for retirement savings. Average benefits of $1,200 a month for fully-retired people are barely enough for the bare necessities.

Best Retirement Advice From The Experts: http://peerfinance101.com/2015/02/best-retirement-advice-experts/

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Retirement Myth #3: You’re Safe Withdrawing 4% of Your Portfolio

Even the safest bonds of U.S. companies pay just 2.9% and that’s still above the 1% you’ll earn on bonds of European companies.An arbitrary 4% can change significantly depending on the fickle nature of the stock market.

>>The 2007 retiree may be fine with a 4% withdrawal on a portfolio of $950,000 but that 4% may not have been sufficient in 2009.

With a clearer picture of your needs, you’ll be able to understand the return you need on investments and how close you are to your sandy beaches.

Will You Be Ready for Retirement: http://peerfinance101.com/2015/02/ready-for-retirement-infographic/