A financial discipline can help you in avoiding anxiety and depression after your retirement. Some people get into financial distress despite accomplishing their retirement goals, do you know why? Because they indulge themselves in wrong financial habits. We will tell you about 3 important financial bad habits that can destroy your retirement life and steps you can take to avoid such bad habits.

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Overspending- Exhausting the retirement fund

Imagine, when planning your retirement during your working life, you estimated that building a certain size of retirement fund would be sufficient and you successfully built that retirement fund too. However, during your retirement period, you started spending more than you had originally planned thus exhausting your corpus to outlive your remaining life. Avoid the bad habit of spending more than you have actually planned.

You should make a retirement budget based on the size of your retirement corpus. If the spending exceeds your planned budget, you must take immediate steps to reduce it.

Staying Underinsured- Ignoring health insurance cost

Health insurance requirements increase as you grow older because you become more susceptible to ailments and hospitalization risk increases. To save premium and use the saved money towards lifestyle expenses, some retirees reduce their health insurance size. Staying underinsured can put your entire retirement corpus at risk. Avoid the bad habit of disturbing your crucial retirement instruments to accomplish your spending spree.

Never disturb your health insurance policy. Pay the premium on time. Instead of reducing the cover size, if you think that the medical cost may increase quicker than your earlier estimation, then you may try to increase the size of your health insurance policy.

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Running out of retirement corpus sooner than planned-Ignoring the inflation

Retirement is not the end of your financial planning, rather it’s a new beginning with even greater financial challenges. What if you come to know after your retirement that the corpus you have in your hand will not be sufficient to meet your financial needs for your remaining life? If you are prepared, it may not happen to you, but what if you are not prepared? Not aligning the corpus growth rate with the prevailing inflation rate could be a serious mistake and put the retirement corpus at risk of running out sooner than originally planned.

You should adjust your spending habits according to the prevailing inflation rate and invest your retirement corpus in such instruments that can generate a higher real rate of return.

The author is an independent financial journalist.