Reasons Why Retirees Go Broke

It pays to have a sizeable retirement fund set aside. It will give you some sense of financial security and comfort when you do reach this stage in life. Having such a fund allows you to enjoy your retirement and have a more relaxing life with less financial worries. But bear in mind that you may still be at risk of going broke during retirement if you are not careful with your finances. Here are some common reasons that may lead many retirees to end up being broke.

Spending Too Much

One of the things most retirees expect during retirement is enjoying more leisure time. But the same thing they expect can also be the reason for going broke if they are not careful with their expenses. Any retiree can easily go broke when they start spending more than what their funds can provide for them. It will only take some time before that retirement fund dries up. Avoid this mistake by creating a retirement budget that provides you with better control of how you spend your retirement fund. Make sure that your budget is made based on prolonging your retirement fund for as long as possible.

Relying On Only A Single Income

Surviving retirement is a means of finding some way to earn income. Most people will uusually rely on just a single income source during their retirement. A majority depend on getting their income from Social Security pensions, which generally will not be enough to cover one’s retirement expenses. The problem with a single income stream is that retirees will not have any option when that income stream eventually dries up or become insufficient.

You’re Not Healthy

While retirement may be a time for relaxation, you may not be able to enjoy as much if you end up with a variety of health conditions. Ending up unhealthy will bring about added medical costs which can eat up on your retirement fund. Increasing medical expenses along with a dwindling retirement fund will become a very serious problem later on.

 

 

Posted by Ardent Editor on Jan 12 2020 in Financial Planning Tags:

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