Retirement mistake…
“Finance Guru Jean Chatzky: This Is the Biggest Retirement Mistake You Can Make.”
Are you winging your retirement spending? Financial expert Jean Chatzky tells Kiplinger why lack of a concrete plan is preventing retirees from living their best lives.
Do you have a plan for how you’ll spend your money in retirement? If not, join the club. Many retirees wing it when it comes to withdrawing their hard-earned savings.
But that’s a big mistake, says Jean Chatzky, best-selling author of The Forever Paycheck and founder of HerMoney. It’s the biggest mistake retirees can make.
“The lack of a concrete plan actually prevents them from living their best retirement,” Chatzky tells Kiplinger. “They are not living as well as they could.” If you overspend without a plan, you could face a retirement shortfall. If you underspend, you won’t get to fulfill your retirement goals.
Reluctance to spend among retirees
Underspending is a common problem among retirees, despite large nest eggs built on a decade-long bull market. By the end of 2024, Fidelity Investments reported that baby boomers made up 41% of all 401(k) millionaires, while Generation X (ages 45 to 60) accounted for 57%.
Yet, despite healthy balances, many are wary of spending. A recent Corebridge Financial survey revealed that less than one-third of retirees feel comfortable spending their savings, with most noting that the prospect causes stress or anxiety. While Chatzky emphasizes that a detailed strategy can alleviate many of those feelings, just 14% of retirees report having a plan to manage their required minimum distributions.
“There are a number of decumulation strategies, but I’m a believer that covering your fixed costs with some sort of paycheck, some sort of guaranteed income, is likely to enable people to live better with less stress,” Chatzky says.
More Information at:
https://www.kiplinger.com/retirement/retirement-planning/jean-chatzky-biggest-retirement-mistake
