Everyone looks forward to one day being able to stop working and to spend more time with your family and loved ones during retirement. What you may not know however is that there are a few things that actually may negatively affect your retirement. If you are like most folks you want a seamless retirement that has no issues whatsoever so that you can just relax and enjoy the time you have left on this earth. Let’s take a look at a few issues that you should avoid so that your retirement doesn’t have to be affected negatively.
- Don’t bite off more than you can chew when it comes to buying a home. By this I mean don’t purchase a home that is too expensive for your budget. Doing so may cause you issues in your later years because you may not be able to save for retirement the way you had intended to. You don’t want to find yourself unable to retire when you had planned because you have to use your money to make monthly mortgage payments. No one wants to be a slave to their house so be sure not to make this mistake.
- Another retirement issue you should avoid so that your retirement is not negatively affected is using your retirement account for a down payment on a house. If you cannot come up with a down payment for a house on your own then perhaps you should wait until you can afford to do so, or don’t purchase a new home at all.
- Not having an emergency fund when you are planning on retiring soon is not a good idea. The main reason you want to be sure your emergency fund is full nearing retirement is because you may have some repairs and things that need to be made on your house and you don’t want to run up credit cards so close to retirement. You also don’t want to use your retirement fund to pay for repairs when you don’t have to do so. Having an emergency fund of at least $1,000 is a good cushion that should help out in a pinch.
- If you plan to downsize your home it is a good idea to go ahead and do so. Many times folks try to keep the large house they have always lived in and use their retirement savings to pay it off, which in many cases will likely deplete the savings you had intended to live off of in your latter years.
Hopefully these retirement issues won’t be a problem for you now that you have been made more aware of them and know how to avoid them.
Courtesy of Greenville NC Realtor Liz Freeman.