Top Retirement Mistakes You’ll Want to Avoid

Salaam African Bank: Avoid the Top Retirement Mistakes

Retirement is supposed to be a time of joy and relaxation. Without proper planning and decision making while still being employed, many can end up in challenges that they least expected. Here are the top five retirement mistakes.

Budgeting

Many retirees rush to retirement without  having a plan. Many simply say, “ Oh, I have money in the bank, or I might as well spend it while I’m living,” but this way of thinking leads to problems. The first thing a retiree should do is set up a budgeting plan on a month-to-month basis, but many fail to do so and go on vacation and extravagant dinners instead. Lifestyle adjustments are essential to living a retirement life stress free. Instead of eating out for every meal when retired, you should learn how to cook and plan meals on a daily budget. This goes the same for shopping and spending money on vacations. When you’re retired, your focus should shift from wants to needs. It’s important to create a budgeting plan that includes your daily/monthly costs, as well as having a plan set up in case of emergencies. This will help you avoid cost challenges in your daily life as a retiree.

Cashing Out

Many people rush to cash out their social security benefits as soon as they hit the proper age. Just because you’re retired, doesn’t mean you need to cash out your benefits right away. The problem with this could be that you’ll receive less than you are actually eligible. For example, The Finance World says that if you cash out at age 62, you’ll receive 25% less than if you cash out at age 66. If you can afford to pay your bills, then there is no need to cash out your benefits for a couple years. However, you should cash them out by age 70, because this is the age that you’ll receive maximum benefits.

Home Costs

Paying off your home before retirement is the goal for most people. If you’re retired, you shouldn’t be making monthly payments on a home you don’t already own. But you also shouldn’t be spending a lot of money on the upkeep of your home. If your home is paid off, but you find yourself still paying a lot of costs for the upkeep of your home, it may be time to sell your home and buy a smaller one. This will allow you to downsize your monthly cost and have extra cash on hand for emergencies.

Gifting Money

Holidays and birthday gifts, as well as loans are prime for losing money.  You should not be gifting or loaning money out, because you never know if you’ll actually get it back. By the time you’re retired, your friends and family should know that you are in a part of your life that you cannot financially help them. Many retirees make the mistakes of gifting cash or giving out loans, and they never see this money ever again. This is the money that you’ve worked for all your life and now must live off it, so you can’t afford to hand it away. However, having the proper budgeting plan can allow you to plan on how much you’ll spend on gifts and loans, to help avoid losing your money.

Not Staying Active

Although retirement is for relaxing, many retirees don’t stay social and active. Retirement should be about getting together with old friends and spending time with family. It is also a time that you can do anything for yourself, such as learn a new hobby, try new things, go to new places. One of the many mistakes that retirees make is becoming secluded within their lives, which could lead to depression or higher health risks.  This is terrible for the physical and mental health of humans. This is a time you should continually be feeding the mind and the body with healthy habits such as reading, socializing, and walking. You’ll live a happier and longer retirement if you do so.

Choosing the Bank That’s Right for You — SALAAM AFRICAN BANK

Choosing the Bank That's Right for You — Salaam African Bank

Choosing the Bank That’s Right for You — Salaam African Bank

There have never been more banking options that there are today. But with so many options to consider, it can be difficult to know which bank is right for you. Choosing the right bank depends on a number of different criteria. Yet the most important one might be finding a bank that helps you meet your financial goals.

Banking Experience and Location

If you prefer to bank in person, then you need to pick a bank with a lot of locations in your area. Otherwise, you won’t get the type of banking experience that you enjoy. You’ll also need to consider whether you want to walk, take public transportation, or get in your car to visit the bank. Traveling thirty minutes across town to deposit a check or speak with a banker in person isn’t very convenient. World-travelers need to make sure they choose a bank with locations throughout the globe. Having easy access to money makes traveling a lot less difficult.

Hours

If you work during the day, you’ll need a bank that is still open when you leave work. Many people prefer to do their banking on the weekend. Not all banks offer weekend hours, so make sure you pay attention to this detail if you prefer weekend banking.

Online Banking

Online banking is a very popular option, and it seems to become more and more popular as each year passes. Many banks offer their patrons the ability to deposit checks online simply by taking a picture of the check with their phone. Today, almost everyone has a phone which makes it easy to keep track of banking information via an app. Online banking also makes it easy to transfer money between accounts.

Fees and Rates

Every bank has different fees. Some have monthly maintenance fees just for having an account. Some charge you every time you use an ATM that doesn’t belong to the bank. All of these fees add up, so read the fineprint before depositing your money. If you want to open a savings account, pick a bank with high-interest rates. In some cases, it’s a good idea to use an online bank for your savings. Online banks can offer high-interest rates because they don’t have to spend money on physical locations and tellers.

Services

Do you plan on purchasing a house, starting a business, or getting a credit card? If so, you’ll need a bank that can offer mortgage loans and business loans. Not all banks offer these services. Small, community banks typically offer limited services while large national banks have the ability to do more for their customers due to their size.

Whatever bank you decide on, don’t just pick it because it’s the closest one to your home. Location and convenience are important, but there are so many other factors that you need to consider. If the bank that’s nearest to you just opened a month ago, it might be a better idea to go with a more widely-known institution that’s been in business longer. Do your research, and you won’t have to worry about your money.