Saving for retirement is important, but the key is to do it wisely. After all, what’s the point of saving for retirement if you do so in such a way that you harm yourself in the process? Here are five bad ways to save for your retirement.
1. Neglecting your health
If you think a good way to save for your retirement is to neglect your health, think again. What’s the point of saving up for retirement if you’re going to be in such bad health that by the time you get there you spend all your money on medical care? Would looking at your bank account really make you feel better when you’re experiencing chronic health problems and pain? Do yourself a favor and spend the money now instead of later so you can actually enjoy your life. This means going to the doctor when there’s a problem, spending money to deal with your health issues, exercising and eating healthy.
2. Delaying repayment of credit card debt
Some articles advocate saving money before paying off credit card debt. This article does not. It’s just not a good idea to tuck a large amount of money away that will earn a modest return while accruing ridiculously large amounts of debt due to credit card companies charging a good twenty percent a year or more for interest. You’ll save up all your money… just in time to retire and then pay off all those credit card bills that were mounting up for years.
3. Cheating other people
This should be a no brainer, but cheating other people in order to get money for your retirement is not a good idea for several reasons. If you get caught, not only will you lose all your ill-gotten money but you may be liable for damages beyond that as well. If you have the tiniest shred of a conscience, this will haunt you well beyond retirement so you won’t be able to enjoy your money without guilt. Even if you do manage to get away with it, karma will get you eventually.
4. Deprivation
The key to saving money for retirement is long term gratification. Right now it may be annoying but one day you will be grateful you had the foresight. That doesn’t mean though that you should delay all of your gratification until retirement. Don’t deprive yourself of the pleasures of today so you can save it all up for tomorrow.
5. Entering into business deals that sound too good to be true
Taking an offer or investing in a deal that sounds too good to be true will not get you the retirement funds you desire – in fact, it will probably do just the opposite. Use your common sense to determine if you are being scammed. Blindly trusting your potential business partner is a bad idea. Always ask questions if something seems fishy. Many scammers rely upon the fact that some people will not understand the legalese being used but are too embarrassed or proud to admit it.
About the author: This is a guest post by Life Cover.ca, a source of reliable, online life insurance quotes. You can find lots of information and tips about buying life insurance products on their website.
Credits: Photo courtesy of Nelson Kwok.