Planning for retirement can be compared to trying to predict the unknown.
There are so many variables which affect a person's ability to live well in retirement, and it is easy to become overwhelmed with the prospect of having to get everything right in order for all to work out.
Because retirement is often treated as the great unknown, various versions of popular wisdom, promising to give future retirees a better insight into what they will or won't need for retirement, continually pop up. But often these stories are nothing more than myths –seemingly meant to scare hapless seniors into a certain way of thinking.
But today’s (and tomorrow’s) retirees are brighter, healthier, and stronger than ever before. With this in mind, let’s dispel some of these unfortunate myths.
Myth #1: Retirement is a time to stop working
One of the biggest myths of retirement is that you should stop working once you retire.
Those who truly enjoy their work often have a hard time deciding when to retire, because for them working is a pleasurable activity and they generally cannot think of a better way to spend their time.
Those who retire from their chosen careers, especially when they were not totally in love with what they were doing, may find more rewarding work in pursuing a lifelong passion such as working as a painter, volunteering or getting involved in causes which matter to them.
Retirement does not have to be a time when you stop working and become a permanent babysitter, though watching the grandkids can certainly be pleasurable. Instead, it can be the beginning of the next phase of your life’s work.
Myth #2: One million dollars is not enough
Recent headlines in several financial publications have warned future retirees that retiring with one million dollars will not cut it in today's economy.
One of the main reasons for this proclamation is that, in today's market, interest rates are so low that one million dollars would not grow fast enough to meet a retiree's needs.
But consider this: one million dollars will allow you to spend $50,000 per year for 20 years - if you never earned a dime of interest.
Add to that your Social Security income, and it's clear to see that with proper money management you'll be fine retiring with one million dollars in today's economy.
Myth #3: Play it safe
For the vast majority of retirees investing your retirement funds in a safe investment is good idea.
But, all people were not created equally. Some retirees may wish to live out lifelong fantasies of traveling the world or starting a business.
These kinds of expenditures generally go against popular wisdom, but popular wisdom is given for the masses, not for the individual. Remember that your retirement is the time that you are meant to thrive and do the things that you have always wanted to do, not just survive.
This does not mean that you should go out and blow your entire retirement savings in a frivolous manner. But all too often popular wisdom tells seniors to pay it safe, as if retirement is a synonym for "settle for less."
This kind of thinking reflects the mentality that the world belongs to the young. You may just be the person to prove that even the mature crowd has a lot of life in them yet.
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