Retirement Planning may not be fun, but if you really want to achieve financial independence you can't ignore it. I would like to share my 10 great reasons to ignore retirement planning.
By David Rae Certified Financial Planner™, Accredited Investment Fiduciary™
Reason #10: "I don't have time to plan for retirement."
While I will admit setting up a well thought out retirement plan can be time consuming, especially if you are attempting to do it yourself, but with something this important you should consider making time now. If you keep saying "I'll take care of it... tomorrow" soon years will have passed. Procrastinating won't help you get any closer to financial independence. The world will not end if you miss one drunken Sunday Funday.
Reason #9 "I don't need to, plan for my future"
You should be proud of all the money you've saved, and the wealth you've accumulated. Are you sure it will be enough to cover a 30 year retirement? Do you have a plan for how to take distributions? Do you want to take all the time to manage your investments once retired? So you have a plan to minimize taxes? If you've answered no to any of these, might be time to spend some quality time with your retirement plan. The LGBT community is more likely to be childless, and single- if you don't do the planning no one will.
Reason #8 "It's too late for me, to have a great retirement"
You may think a dream retirement is unattainable. But it's never too late to take control of your finances and make improvements to your financial plan. If you are unsure of your options speak with a Certified Financial Planner™ . Even if you are already retired, it is important to know how you are receiving you retirement income, and how long you can reasonably expect you life savings to last. It's never to late to improve your retirement.
Reason #7 "I'm way too young to think about a retirement plan"
There is never a better time to be saving for retirement than now. The sooner you get started the easier it may be to reach your financial goals. At the very least make sure get your company matches, and maybe even save some money on taxes. At best, get on a financial plan, and stick to it. Your older self will thank you for it. Before you know it you will be your older self, now that I think about it, where did all that time go. Use your youth to your advantage and get started now!
Reason #6 "The Government will take care of me"
Do you want to live off social security? Have you thought about where you will have to live to afford living off that social security check? Did I mention that your social security benefits may be taxable? Now if you have some other government pension, your odds may be a bit better, but don't forget about places like Detroit, you don't control those assets and there is no real guarantee they will be there when you need them. I don't think the average social security check will cover botox and eating. So there's that.
Reason #5 "My Finances are a Mess"
If this is you, well your financial planning isn't working. It may be time to see out professional financial guidance to help you clean up the mess, get your financial house in order, and keep it that way. Perhaps you have some old 401(K) that can be rolled over and consolidated, or a million other things to take a look at. Consider speaking with a fee-based financial planner who can take a holistic look at your entire financial picture and get you back on track.
Reason #4 "I don't want to think about it"
"Retirement is for old people, and I'll never age." "I hate math", "I hate saving." The thought of financial planning ranks right up there with going the dentist for a root canal. But at least with financial planning you may leave feeling better. Take small steps, bite the bullet now, and future financial planning sessions may be way less painful, I dare say even fun.
Reason #3 "I'll be fine, I have some money saved"
Pat yourself on the back you've saved a substantial amount of money between your retirement accounts, investments, and home equity, but will it be enough? Are you sure? Retiring without a plan for retirement income distributions may be a big mistake. While you may think you know everything you need to know to live happily ever after, many people find that all this complicated stuff is way harder to manage than they thought it would be. Then you add in taxes and inflation oh my! If you run out of money, what then? Wouldn't it be great to have the reassurance that can come with a well thought out long term financial plan?
Reason #2 "I don't have enough money to even get started with a great financial plan"
If you spend more than you make, something needs to change. If you never start building up a nest egg, it will never grow. If you have to start small, and you will be surprised how quickly those little contributions can add up. I've talked to so many people who are don't even notice the money is gone when they set it aside automatically.
Reason #1 "I have no idea what to do"
Personally, I think this is one of the biggest reasons people aren't doing anything to prepare for retirement. You don't have to know everything there is about retirement to get started. Who knows what inflation rates will be in 20 years, or what you health/career/marital status or taxes will be then either. But, we do know you will need to save money to build wealth. Doing all of the financial planning on your own may be a huge time commitment, and requires a great deal of research. If you've been putting off financial planning because you aren't sure where to start or what to do next, consider speaking with someone who can take the load off your shoulders: a professional financial planner.
There are so many reasons people put off planning for retirement. These are just a few. If your financial goals (including retirement) that you want to reach I would recommend set up an action plan with the help of a trusted advisor. Do it now, procrastination is not your friend, and it won't any easier a few years down the road.
DAVID RAE, CFP®, AIF® is a Los Angeles- financial planner with Trilogy Financial Services, a regular contributor to the Advocate Magazine, Investopedia and other fine publications as well as a financial advisor proudly serving friends of the LGBT community for over a decade. Too old to be a millennial too young to be an average (aka boring) financial adviser. For more information visit his website www.DavidRaefp.com or check out his LA Financial Planning Blog
Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Adviser. Additional advisory services offered through Trilogy Capital, a Registered Investment Adviser. Trilogy Capital and NPC are separate and unrelated companies.