Wealthy Living

9 Pieces of Wrong Retirement Advice That Most People Believe

Planning for retirement today is a lot different than it was thirty years ago. Pensions are a thing of the past, the longevity of social security is iffy, and the stock market seems to be one bubble after the next.

Unfortunately, the clichés of retirement advice haven't changed much, and many are badly outdated.

According to money experts, here is some of the worst advice most people still believe, but you should definitely avoid.

Bad Advice #1: $1 Million in the Bank Equals Retirement Success

Rules of thumb are attractive because they make the complex simple to understand. Believing that a certain dollar amount is the main factor that determines your retirement success may be misleading.

Years ago there was a popular TV commercial where a client was walking around with a large $1 million dollar theater prop under his arm. He was carrying this large number around town like a trophy and it took both arms to hold it.

But it turns out that a certain dollar amount is misleading if you don't factor in your projected retirement expenses and what your related cash flow might be.

Bad Advice #2: Annuities and Whole Life Insurance Will Protect Your Income

You must avoid falling for expensive insurance and annuity sales tactics that are too good to be true. Variable annuity sales increase when the stock market has declined.

Bad Advice #3: You Can't Afford a House Because of Your Starbucks Habit

The dumbest piece of advice nowadays is that your morning Starbucks and Netflix subscription is what's stopping you from buying a house.

When house price inflation is in double figures, on the average salary, the best you can do is to save enough to stand still.

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