5 Common Mistakes When Saving for Retirement
Here are the top five most common mistakes many people make when saving for their retirement.
1. Starting Too Late
The best time to start saving for retirement is as soon as possible. There is no better time than the now. Even if you are in your early 20s it is still a great time to start saving for your retirement. Be sure you start saving for retirement as soon as possible to ensure you will have enough.
2. Not Saving Enough
Did you know that most financial experts recommend that you save 15-20% of your income for your retirement? It is a significant percent of your income but in the end, it will be worth it to have a large nest egg to retire on.
3. No Savings Account
It’s best to save money for retirement in a variety of places. You may have some funds set aside in your 401(k) but did you know that savings accounts are a great way to save for retirement? Community banks are known for supporting communities and looking out for their customers. The experts at Citizen’s National Bank will be there for you every step of the way and can help you create a retirement savings account. The benefit of keeping a portion of your retirement contributions in a community bank savings account is that you will gain interest on the funds.
4. Overestimating Working Years
Another common mistake is that people overestimate how long they will be in the workforce. Some people plan on working until 70 and believe they’ll have more time to save up for retirement. However, illnesses and other unexpected factors pop up around retirement age that limit how much a person can work. Try to be as realistic as possible when predicting how long you will be able to work.
5. Not Budgeting
Setting a budget is a great way to save up money for retirement. Making changes to your cost of living and creating a budget can help people make significant contributions to their retirement fund. By budgeting, you could potentially add an extra $500 a month to your retirement fund and give yourself a better retirement nest egg.
Overall, if you’re looking to save money for retirement it’s best to avoid these five common mistakes. If you want to make significant contributions to your retirement fund get started today by setting up a savings account with Citizen’s National Bank.