3 Preventable Mistakes That Can Ruin Your Retirement Planning

You’re reading this article, which proves that you’re at least thinking about retirement. But I’ll take it a step further, and assume that it’s likely you are currently waist-deep in the retirement preparation process.

That’s great! Unless, that is, your decisions are unwittingly taking you down the wrong path.

How do you really know if the decisions you’ve made so far are the best ones for your future? How do you know that you’re not making a mistake today that’s going to cost you big time some 20 years down the line?

What follows are three of the most common mistakes that even the most conscientious savers make as they hit the final stretch of the retirement preparation process.

1) Not understanding the risk in your portfolio.

Every few days someone comes into Hanson McClain for their first appointment—someone with over $1 million saved—and we run their existing asset allocation through our Portfolio Stress Test.
Guess what happens? We test their portfolio against various historical scenarios, and we find that there’s a very real possibility that if the market went into cardiac arrest—let’s say it dropped by 40 percent—that their savings would very likely get wiped out.

And, usually, this revelation takes them completely by surprise.

That’s because a shocking number of people have no idea, as in, NO IDEA WHATSOEVER just how much risk they are carrying in their portfolio. Our Portfolio Stress Test takes your asset allocation and compares it to as many as 24 historical major market events to see how your investments are likely to respond in a crisis.

Here’s a warning: If you do nothing else in the next two weeks, get the allocation of your portfolio tested. You’ve worked extremely hard for your money, and it would be a tragedy to see all that disappear because of a terrorist attack, a natural disaster, or an inexplicable stock sell off that causes the market to crash and then takes your money down with it.

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