Retirement mistakes

Five mistakes to avoid when approaching retirement

Whilst you can take steps toward planning your retirement, often professional advice is the only way to ensure you do so without committing costly mistakes. 


Retirement is an important time in our lives and many of us look forward to the days when our time is our own.

However, it is not always easy to achieve your ideal lifestyle in retirement without professional advice, and mistakes are often made by those who try to navigate their retirement planning journey alone.

It is crucial that you make informed decisions as you prepare for such a significant life stage; therefore, we have identified five common mistakes that you should avoid as you move towards retirement.

The mistakes

Failing to make a retirement plan

This is perhaps the most significant mistake and extends beyond the monetary elements of financial planning. Whilst planning your financial arrangements is important, you should consider your lifestyle aspirations too.

  • How do you plan to spend your time? 
  • What are your hopes for retirement?
  • What income will you need to support your desired lifestyle?
  • What are your expenses likely to be?
  • What capital sums would you like?
  • What are the other risks to your retirement income?

Without clear answers for these questions, you will not know how much money you require in retirement nor the steps you need to take to get there. 

Inadequate retirement savings

How much is enough? The answer to this is dependent on your plans for retirement and the lifestyle you wish to lead. 

Many people underestimate the amount of money they will need to accumulate over their working lifetime to provide an income that will support their ideal lifestyle. Additionally, as life expectancies continue to rise, our savings need to last longer than we perhaps anticipate.

Failing to save appropriately for retirement can leave you financially unprepared; therefore, you should save what you can afford, and do so wisely, to build a sufficient level of assets to support you in retirement. Therefore, it is important to make use of the tax efficient savings schemes available to you, such as your employer’s automatic enrolment pension scheme.

Whilst you may be fortunate enough to inherit wealth, it would be unwise to base your planning on this.

Not taking appropriate levels of risk

Much of life is about striking a balance and investment is the same.

Whilst it is possible to take too much risk, you can also take too little – and both could result in you being unable to meet your retirement objectives.

Instead, and to achieve the correct balance, you should consider your objectives, attitude to risk and capacity for loss, as well as the range of investment options available to you.

You should also avoid reacting too strongly to short-term market movements, as this can also impact your ability to build up your wealth overtime.

Failing to diversify investments

Relying heavily on one asset class can be risky, as it leaves you exposed to its fortunes.

Diversifying assets spreads the risk of being overexposed to any single asset class, as well as helping to manage volatility and deliver returns within an agreed range and time frame. You should also adjust the mix of asset classes you invest in to suit the different stages of your retirement planning, from building your pension fund, through to approaching retirement and when you start to access money.  

Ignoring care costs

People continue to live longer and, therefore, you need to plan for this accordingly.

The Office for National Statistics reports that a 65-year-old man can look forward to 18.5 years in retirement, whilst women of the same age can expect 21.

Whilst we lead generally healthier and more active lifestyles in the early years of retirement, our health does inevitably decline over time. Have you considered what this could mean in terms of care and the associated costs?

If there is a possibility you may need to spend an extended period of time in care, or receiving assistance, this should be accounted for in your planning. If you do not plan for this, you could be forced to sell your home and other assets.

How can we help you?

To help our clients prepare for their retirement, we provide a range of financial planning services. These include:

  • Retirement planning;
  • Inheritance tax planning; and
  • Lifetime cashflow planning

Working with clients in these areas allows them to see if their objectives are achievable and set a plan to achieve them – all of which provides much needed peace of mind.

If you would like to discuss the options that are available, or if you wish to arrange an initial no cost, no obligation, consultation, then please fill out the contact form below. Alternatively, you can call 01603 706 820 or email

Important information

This is solely for informational purposes and nothing in it is intended to constitute advice or a recommendation. You should not make any investment decisions based on this content. The value of pensions can fall as well as rise and you may not get back the amount you originally invested.

While considerable care has been taken to ensure this information is accurate and up-to-date, no warranty is given as to its accuracy. This article constitutes a financial promotion.

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