8 ways to ruin your chances to retire

Spend too much
The most obvious way to ensure that only death's sweet embrace will release you from the bonds of employment is simply by saving nothing and spending a lot.


Save little or nothing
In America, spending is in our collective DNA, but saving is not.


Ignore other savings vehicles
If your job doesn't come with benefits, as is the case at many small businesses, then obviously, you're totally off the hook -- working well beyond your twilight years is virtually assured. After all, it's not like there are any alternatives for deprived employees or the self-employed, for that matter.

Delude yourself no further. You do have options. Take, for instance, the SEP-IRA or the individual 401(k) plan for the self-employed.

And don't forget the humble IRA -


Disregard taxes
Some people may wait to screw up their retirement. Though the process of not saving can last a lifetime, actual savings may not when it comes time to get a distribution from a tax-deferred account.

"Often people make incorrect assumptions about what their lives will be like in retirement," says Certified Financial Planner Paula de Vos, president of Synergist Wealth Advisors. "They think they will be in a lower tax bracket, but they may be in a higher one."

Unless your retirement savings have been invested in a Roth IRA or a Roth 401(k), distributions will be taxed as ordinary income


Overestimate portfolio earnings
Compounding interest is indeed magical. A little money plus a lot of time can equal a lot of money. But there's only so much it can do with the variables involved.

Retirement hopefuls who dillydally in their savings efforts may find the time portion of the equation so drastically reduced as to be somewhat ineffectual without lots of money thrown in.

Similarly, young people whose savings start strong and then taper off might find that they could have accumulated much more money had they just saved more consistently over time.


Miscalculate lifetime earnings
Some optimistic people assume that one day their paltry income will catch up with their spending and they'll finally have more than enough money to pay their mortgage off, save for retirement and pay down debts.

"The economy has been pretty nice to us over the past 10 or 20 years, and kids don't know what it was like in tough bear markets," says Dallas-based CFP Chanc Woods, member of the Financial Planning Association.

"The great Depression was so long ago that kids don't know how difficult the job market can be, or how bad the economy could get. Everyone knows that they should have three to six months of expenses saved up, but instead everyone is trying to be cool and buying nice cars and clothes," he says.

That throw-caution-to-the-wind-type thinking lends itself to the work-until-you-die lifestyle

Adopt the ostrich-style planning approach
If you've been able to tune out advertising messages and instead accidentally scrimped and saved for your golden years and find yourself doing pretty well, don't worry -- there are still plenty of ways to go wrong.

For instance, without a plan for every aspect of retirement, things can go seriously awry. From long-term care needs to the death of a spouse, any number of factors can derail a plan. The what-ifs could keep a less sanguine person up at night.

"Part of a retirement plan is knowing that we're saving this much every month and we're 35 and at a 5 percent return in 30 years we're going to have all this money," says CFP Ralph Lunt, vice president and chief financial officer at Strategic Capital Advisors. "Well, what if one of us isn't here next month?"

Remain ignorant about investments
Though actually socking away dollars goes against the never-retire plan, using that money ineffectively can hamstring any retirement efforts.

"People may underestimate the power and the benefit of a globally diversified portfolio. Because a portfolio has a bunch of different things does not mean that it is a globally diversified portfolio,

Whether you do it yourself or have someone to help you, planning is essential unless, of course, you want to work until you die.