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Avoid These 4 Regrets in Retirement

Happy senior man with no retirement regrets fishes with his son

Live Life to the Fullest

Retirement is a dream come true for many people as the commitments of work subside and they become free to pursue hobbies, travel and spend time with loved ones. However, not everyone finds complete joy and contentment throughout their retirement years. In fact, many retirees report having regrets. While it’s impossible to change the past, you can learn from others’ mistakes.

Following are four common retirement regrets and tips to help you avoid them.

#1 – Not saving the right amount

Many retirees have regrets about the amount they saved throughout their lifetime. Some progress through retirement wishing they had saved more. These individuals may have waited until they were older to start saving, and now they don’t have enough money to fully realize their retirement dreams.

On the flip side, some people regret sacrificing opportunities to experience life because they were too focused on saving for the future.

The key to finding the right balance is to develop a clear understanding of your financial priorities and establish a savings/spending plan that’s focused on achieving your goals. Your wealth manager can help you articulate your goals as well as develop a custom financial plan to help you achieve those goals and avoid regrets down the road.

#2 – Focusing on the wrong things

Along the same lines as not saving the right amount, many retirees face regrets after spending many years focused on the wrong things. For example, when looking back at their lives, some retirees regret spending too much time and effort on their careers and not enough time with their loved ones.

Make an effort to be mindful about your saving and spending throughout your lifetime. Taking time to identify and articulate your priorities can help you focus on the right things, not miss out on experiences and live a more fulfilling life — all while also planning for the future.

#3 – Making a big financial move early in retirement

One common mistake made by many retirees is making a big financial move before fully settling into retirement. For example, some retirees decide to sell their house and move to a new state during the first year of retirement only to discover too late that the new location doesn’t suit their lifestyle as well as they anticipated. Or they end up missing friends back home and wish they’d never left in the first place.

On its own, retirement is a major life transition. While you may think you know what you want your life to look like, you could discover your actual experience is quite different than you had anticipated. It’s wise to settle into your new lifestyle for at least a year or two before making any other big financial moves. Instead, take smaller steps to test the waters before you commit. For example, if you’re considering purchasing a home in a new state, it may make sense to rent for a while first to make sure you enjoy the area and are ready to become a permanent resident.

#4 – Not understanding potential healthcare costs

Healthcare costs are typically one of the biggest expenses faced by retirees. In fact, a 65-year-old couple that retired in 2023 can expect to spend approximately $315,000 on healthcare expenses throughout retirement.1 Given that large financial commitment, some retirees regret not adequately planning for retirement healthcare expenses.

If you’re still working, consider saving in a health savings account (HSA). Contributions to an HSA are made with pre-tax dollars, which can help lower your taxable income during the year in which the contributions are made. Plus, HSA funds grow tax-deferred within the account and can be withdrawn without tax liabilities when used to pay for eligible medical expenses.

In addition, HSA contributions made via payroll deductions aren’t subject to Social Security or Medicare taxes and, unlike with 401k contributions, there are no required minimum distributions (RMDs) from the account. Also, because HSAs allow for investments in mutual funds (once certain asset levels are achieved), assets invested have the potential to grow over time and enhance your overall retirement savings.

Could you use some help avoiding common retirement regrets? Creative Planning is here for you. Our experienced professionals help clients develop custom retirement plans to meet their needs and achieve their retirement goals. To learn more, schedule a call with a member of our team.

This commentary is provided for general information purposes only, should not be construed as investment, tax or legal advice, and does not constitute an attorney/client relationship. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable but is not guaranteed.

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