10 Ways to Wreck Your Retirement

According to the Dallas-based National Center for Policy Analysis, many Americans are making expensive mistakes with their retirement savings.  As traditional pensions have given way to self-directed retirement plans such as 401(k)s, individuals have been given the responsibility for retirement planning without sufficient education in how to “do it right.”  As a result, many people are woefully unprepared for their financial future.

Ms. Pamela Villarreal, senior policy analyst at the National Center for Policy Analysis believes that “Out of fear and the best intentions, we’re seeing too many people literally liquidating their own retirement.”  Along with other analysts, Ms. Villarreal has identified the “10 Most Common and Damaging Financial Decisions” that can wreck your financial future.  They are:

  1. Not saving consistently
  2. Not taking advantage of your employer’s 401(k) or Simple IRA
  3. Borrowing against your 401(k)
  4. “Cashing out” your 401(k) when changing jobs
  5. Trying to “time the market” with your investments
  6. Treating your home like a “piggy bank” with home-equity loans
  7. Not diversifying your investments
  8. Underestimating how long you’ll live
  9. Ignoring inflation
  10. Continually staying in debt, which is truly “negative cash”