For Mark Roberts’ Use: Retirement is one of the biggest changes you’ll experience in your lifetime, and also one of the most nerve-wracking. Luckily, millions of people have ventured into this territory ahead of you.. And you can learn a lot from them, such as these potential pitfalls.

Underestimating your longevity. Unless you have good reason to believe otherwise, most people should plan on living well into their 80s these days. That means your retirement could last twenty years or more, and you need to plan for adequate income, for both yourself and your spouse.

Overlooking the impact of inflation. Since inflation rates have remained historically for the past few decades, many of us don’t even think about it when planning for the future. But keep in mind that we’ve averaged an inflation rate of about 3 percent since 1982. That’s low, but will still impact your purchasing power. In fact, over a twenty-year period, an annual 3 percent inflation rate will cut your purchasing power by almost half… and we just reminded you that your retirement could last that long!

Making assumptions about Social Security and Medicare. We frequently hear reports of problems within the Social Security and Medicare programs. But so far, lawmakers have yet to reach an agreement on fixing the problems. It’s unlikely that these programs will disappear entirely, despite what some alarmists might tell you. However, changes are not only likely, but probably inevitable… So allow some flexibility in your retirement plan.

Assuming investment returns will remain steady. We probably don’t need to tell you that investments can vary in their returns. If you’ve enjoyed good luck over the past decade or so, it can be easy to assume that your assets will continue to grow at the same rate. But you should always create a Plan B in case things don’t go exactly as you hope.

Expecting lower taxes. Many people make the mistake of assuming that taxes will be lower in retirement, but this just isn’t true. In fact, some methods of taxing retirees can be quite sneaky, such as the inclusion of some of your Social Security benefits into your taxable income. While the tax code does change from time to time, it’s unlikely that we’ll see any major tax breaks for retirees any time soon. So be sure to plan ahead.

We can help you plan for all of these potential pitfalls, as well as others. Since it’s always better to prevent problems than try to recover from them later, continue to make regular appointments with us a priority – now, and after retirement.