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5 Guaranteed Ways to Sabotage Your Financial Future
Your retirement is something you work toward your entire life, and without even realizing it, you may be sabotaging it.
These are some of the most common ways people ruin their chances of a comfortable retirement.
1. Counting on Social Security Alone
Social Security alone is not enough to maintain your current standard of living. You should save at least 10% to 15% of your income for retirement in addition to Social Security. This will guarantee you can retire worry free.
2. Carrying High-Interest Credit Card Debt
Making steep monthly payments on high-interest credit card debt can take a toll on what you’re able to save for retirement. Getting rid of this debt could free up more money you could funnel into your tax-advantaged 401(k) or IRA, high-interest savings account or other investments.
3. Forgetting 401(k) Rollovers
401(k) accounts are notorious for high management and investment fees. Every time you leave a job, look at the fees for the account. If the fees are high, you should transfer the balance to a Rollover IRA. Just don’t withdraw your balance without a rollover or you will pay a steep tax penalty.
4. Borrowing Against Your Retirement
Whether it's to fund a child's college education or to cover the cost of a home repair, once you dip into retirement money in your 401(k) or other retirement account, it can be extremely difficult to repay it and get your investments back on track. You only get the benefits of compounding interest through time.
5. Not Formalizing a Retirement Plan With a Fiduciary Financial Advisor
The value of working with a financial advisor varies by person and advisors are legally prohibited from promising returns, but research suggests average additional investment returns can range from 1.5% to 4% each year.
Voya Financial found that 79% of people who use an advisor said they “know how to pursue achieving their retirement goals.” The study also found that 59% of those who use an advisor have calculated how much they need to retire, while 52% established a formal retirement investment plan.
Chances are, there are several highly-qualified financial advisors in your town. However, it can seem daunting to choose one.
This new tool makes it easy to find the right financial advisor for you. Now you can get matched with up to three local fiduciary investment advisors that have passed a rigorous screening process.
Follow These Steps to Get Matched With the Right Advisor for You
1. Simply enter your ZIP code below.
2. After you enter your ZIP code and answer questions about your financial goals, you can compare up to three top advisors local to you and decide which to work with.
3. Enjoy a better financial future!
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SmartAsset - copyright 2018
SmartAsset - copyright 2018
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