Don’t Fall for These Retirement Planning Myths

I have plenty of time to save:
When it comes to saving, the most important thing you can do is to START. Saving for retirement early gives you the power of compounding allowing your savings to grow longer. And once you start saving, don’t stop!

It’s all about timing the market:
Don’t make short-term decisions with long-term money. For individuals working towards long-term retirement goals, one of the most important strategies is time IN the market, not timing the market. Staying fully invested is particularly important when there is market volatility, because the best and the worst days in the market tend to be clustered together. If you were lucky enough to miss the worst days, you also were likely to have missed the best days, which will impact your returns over time.

I’ll just work longer:
There are a lot of factors that are beyond your control when it comes to working as long as you’re planning. A lot of retirements are due to illness or disability. Also, finding employment later in life can be challenging, especially finding something you’ll enjoy with adequate income.

Medicare will cover my retirement healthcare needs:
Medicare can give you affordable health insurance coverage for doctor visits, medication and hospitalization once you turn 65. However, Medicare doesn’t cover the cost of deductibles, co-pays or long-term care that lasts more than 100 days. Those costs are on you. Typically, the biggest health expense in retirement is long-term care.

Social security will be enough… I don’t need to save:
Social Security is probably more secure than most people think BUT you can’t count on Social Security payments to cover all of your retirement expenses. According to the Social Security Administration, on average, retirement beneficiaries receive 40% of their pre-retirement income from Social Security. It makes sense to estimate your payments as part of your overall retirement planning. Set-up an account at to access your current Social Security statement and review an estimate of your monthly retirement benefits.

Two simple concepts to remember:

  • If you’re not saving already, start NOW. It is recommended to save at least 15% of your pay. If you’re a little behind, you should consider saving even more.
  • Allocation is key. Choosing the appropriate asset allocation that includes both stock and bond investments may provide you with the best opportunity to attain your retirement goal.