A retirement plan can help you build a desired corpus for retirement. Many things go into the planning process, including preparations for unforeseen events that may or may not happen, and each individual must prioritise them as per their needs. The common intention to ensure financial security may be the same, but the process and investments may vary. Seniors tend to make a lot of mistakes in planning and therefore we need to analyse which mistakes to avoid in retirement planning process. However, there are certain aspects that each individual should give special attention to make the full proof.

Many things can go wrong in the planning process. Here are three mistakes to avoid in retirement planning process.

Setting Unreasonable Working Age:

Although people can continue working after retirement at 60, they must set a realistic age limit until the time they want to work. They should also consider whether their health will permit them to work with advancing age. So, even if there are work opportunities, people should consider various aspects while planning for retirement. However, on the positive side, some people may prefer working to avoid boredom or to keep themselves physically and mentally fit.

Hence, one should not consider such income in a plan for meeting post-retirement expenses as the situation may be different from what you had expected by the time you retire. Besides health reasons, the job landscape may differ; you may not have many work opportunities.

So, an expectation to work until 65, 70 or above could be an unreasonable consideration, which can lead to despair and confusion later for not having done sufficiently for retirement.

Expecting Unrealistic Returns:

While planning for retirement, diversifying your investment between equities and fixed-income instruments is always a good idea, as it can potentially give higher returns with reduced risks. However, expecting a 20-30 per cent return from your investments may also be unrealistic. Although equities may offer higher returns compared to fixed-income assets, there is no guarantee of returns. So, while making a retirement plan, try to set realistic returns from your investment portfolio. The returns will be less if the assets do not perform.

Anticipating Assets In Inheritance:

This can lead to trouble as it may not turn out in the same way you expected. Although children inherit assets from their parents, fully depending on them for retirement may not be a good idea. For instance, parents may not bequeath the assets to them, or they may have reverse mortgaged the property for regular income. So, expecting assets from inheritance may not be a wise consideration and should not be part of your retirement planning.