Rich in Retirement: Avoid These Top 5 Mistakes!
Every day, retired investors make unforced errors that erode their investment results. These mistakes are so pervasive that even financial professionals make them. If you want to achieve your financial goals and enjoy a rich retirement, free of stress and full of possibilities—like that dream vacation you’ve always imagined—it’s time to take a closer look at these top five mistakes. After all, financial capital is one of the most important forms of wealth, giving you freedom in retirement.
5) Acting on Emotion
“Everyone has a plan: until they get punched in the face” – Mike Tyson.
Most investors can handle an 18% drawdown in their aggressive portfolio strategy. However, when life throws in additional stress—like a disagreement with a spouse, job termination, or dealing with a general contractor on a new home build—emotions can start to cloud judgment. The ability to make rational decisions, even in tough times, is crucial to ensuring a rich retirement. For more insights on managing emotions and financial planning, check our experience and background that has lead to a steady hand.
4) Binary Thinking
The purchasing power of the US dollar is going to collapse!
On a large scale, this statement might eventually come true. But in the shorter term, the dollar could rapidly appreciate if it becomes scarce. Binary thinking—either "all in" or "all out"—is dangerous. Embracing probabilistic thinking instead allows for more flexibility and reduces the risk of being catastrophically wrong. This balanced approach is essential for maintaining your retirement portfolio, so you can still enjoy life’s pleasures, like that big vacation you’ve been planning.
3) Paying Taxes
Why is your joint account full of Certificates of Deposit and Target Date Funds? Fixed income is often taxed at your highest marginal bracket, which can erode your wealth. Meanwhile, Long-Term Capital Gains (LTCG) from index funds offer superior tax treatment and can be deferred until you need the income. To enjoy a rich retirement, it’s critical to optimize your asset location and minimize taxes. Roth IRA conversions, for example, can maximize tax-free inheritance for heirs, helping you pass on wealth—and maybe even fund that family vacation home. Dive deeper into tax-efficient investing strategies on our blog.
2) Bad Strategy
So, you enjoy trading and follow a newsletter. That’s fine—but it should be just one part of your overall strategy. Over-allocating to any single approach exposes you to significant risks, including potentially ruinous drawdowns. A rich retirement requires a holistic investment strategy, tailored to your risk tolerance and retirement timeline. After all, having financial security means you can enjoy those well-deserved vacations without worry. Learn how to build a balanced retirement strategy.
1) Paying Big Fees
Here’s a dirty secret: Your advisor is charging you $7,500/year for algorithmic portfolio monitoring. That’s 1.5% on a $500k portfolio. If you’re paying 150 basis points, you deserve a comprehensive financial plan, cash flow retirement model, Monte Carlo simulation, and more. The sad truth is that many advisors bury these fees and minimize client interactions. For a rich retirement, you need transparency, customized strategies, and ongoing human oversight—not just a hidden algorithm. Make sure you’re enjoying an exceptional value for your hard earned dollars.
Conclusion: Achieving a Rich Retirement
Make fewer mistakes, and you’ll make more money in retirement. CRBSS clients pay low fees and enjoy consistent execution, with capital management overseen by experienced professionals who regularly meet with clients to develop insights. This leads to more customized portfolios and greater confidence in your financial future.
Thank you for reading! Be sure to share this with any investor who might be making these mistakes. Want to learn more? Contact us today for a free consultation or let us know if you think there are bigger mistakes that should have made the list.
