Retirement is something a lot of people are really looking forward to. When we were young, we had a lot of time and had little money. During our working years, we had money but had little time. During retirement, we are excited because we finally have money and time and the same time, well for some of us at least.

It is unfortunate that very few Filipinos actually prepare for retirement but that’s not my point of discussion for this blog. To the few who actually have some money upon retirement, there are many things that can go wrong financially.

The following are some common mistakes of retirees:

1)      Short-term orientation – the fact is, you will probably live about 15 to 20 years of your life during retirement (longer hopefully). Upon retirement, you will still need to grow some of your money and invest a portion on some growth oriented investments like equity funds. While it is advisable to reduce the percentage of your portfolio in more risk oriented investments, don’t totally remove them.

2)      Forgetting about inflation – inflation will not retire just because you did. Your retirement funds will still need to grow to catch up with inflation which is why I recommended investing in some equity funds during retirement.

3)      Putting all your eggs in one basket – the rule on investing still applies during retirement which is to diversify. Maintain a healthy portfolio of cash, money market investments, bonds or bond funds and a small portion on equity or equity funds.

4)      Spending too much, too soon – a common behavior among retirees is the rush into a spending spree. Retirement to others is liberating and the urge to live beyond your means is a very strong temptation. Don’t rush, you still have a lot of time so take it slow.

5)      Simplifying estate planning – you probably will need more than just a will. Retirement is a good time to consider some serious estate planning. Learn about the many ways you can plan for your estate.

6)      Not preparing for medical emergencies – 60 or 65 is still a relatively young age, medically speaking so the need for medical concerns is not yet taken seriously. However, while the spirit is still willing, the body is not and it will be good to provide for a time when we will experience serious physical break downs.

7)      Not reviewing finances & investments – now more than ever, the need to do a periodic review on finances and investments should be a primary concern of any retiree. While it is not a good idea to worry too much, being too care-free is not a prudent thing to do. As I said earlier, you still have a long time to go.

8)      Relying on Social Security alone – seriously? SSS is meant for a retiree to survive, not for a retiree to enjoy his retirement. Do the math, no one can live a decent life with just SSS benefits.

9)      Making risky moves with money – while I recommend that a retiree should still be investing, going into high risk or speculative endeavors might not be a really good idea. A very risky appetite during retirement may not be a swell idea.

10)   Worrying too much – alas, while prudence is key during retirement, fear is a very crippling mindset. So long as you follow common sense and have done your best in preparing for retirement, try to relax as this is what retirement is all about. If you are always fearful that your wealth will not be sufficient during your retirement, you may not live long enough to actually enjoy that wealth.

Like in anything in life, balance is key. Prepare properly for retirement but enjoy it as well.

Those who live in the shelter of the Most High  will find rest in the shadow of the Almighty. This I declare about the Lord: He alone is my refuge, my place of safety; he is my God, and I trust him. For he will rescue you from every trap and protect you from deadly disease. He will cover you with his feathers. He will shelter you with his wings.His faithful promises are your armor and protection. Do not be afraid of the terrors of the night, nor the arrow that flies in the day. Do not dread the disease that stalks in darkness, nor the disaster that strikes at midday… – Psalm 91:1-6, NLT