Just in time for April Fools' Day, here are five foolish retirement planning mistakes that lots of people make.
- Believing in Santa Claus, the tooth fairy and investment returns that are too good to be true. Just this week, the Texas State Securities Board reported that a shyster who bilked $7 million out of elderly investors will get 15 years in jail while his victims will get bupkis.
- Thinking that since grandma died at 65, you will too. According to data released by the U.S. Census Bureau this January, average life expectancy is 78.7 years, But that's the average. In his book on aging, "Rethinking Aging: Growing Old and Living Well in an Overtreated Society," longevity expert Nortin Hadler writes, "I now consider American death before 85 to be 'premature.'" If you aren't planning on longevity, you're inadvertently planning to run out of money.
- Holding your nose and jumping into the retirement pool without testing the water. A study by Wells Fargo determined that 72 percent of people older than 55 aren't sure how much they will be able to spend in retirement or where the money they'll need will come from. Here's hoping retiring swimmers' pools of assets are deep and wide.
- Planning to work until you drop. The Bureau of Labor Statistics says people who lose their jobs when they are 65 or older and go job hunting have only a 23 percent chance of being hired. Those would be OK odds at the track, but they aren't so good if you can't afford to lose.
- Telling your spouse you're calling it quits. About one-quarter of divorces are between people age 50 and older. Consider that under the best of circumstances, you'll only get to keep 50 percent of what you both have, including retirement assets and property. Counseling and making nice is a lot cheaper.
Have a terrific April.