Instead of focusing on risks that we are aware of, we should be turning our focus on risks that we are oblivious to, Walter Updegrave writes on TIME.
How can you veer and steer toward successful retirement? It’s simple.
Here are three risks that you should protect against:
Don't let yourself fall prey to complacency risk. Give yourself a retirement inspection to protect against this risk. An easy way to checkup on your retirement is by using a retirement income calculator tool. Plug in your information, the amount that you are saving each year, and the age you plan to retire. The calculator tool will give you a close estimate of your likelihood of reaching your goal.
Emotional risk has the tendency to be highest during periods of market extremes. Allowing your emotions to influence your investing strategy can impose damage on your retirement prospects. With an an asset-allocation strategy, you can manage this risk by setting it and then putting it in writing. Vanguard's asset-allocation tool uses experts to explain how to choose investments that align with your risk tolerance, time horizon, and financial goals.
Planning for retirement can be complex, and there are many components that must be taken into account. If you lowball how long you might live, you might outlive your savings. Luckily there is the Actuaries Longevity Illustrator. The Longevity Illustrator: "is designed to provide you with perspectives on your longevity risk—the uncertainty of how long you and your spouse/partner might live." This will allow you to think about the risks of outliving your economic resources.