5 Retirement Planning Mistakes to Avoid, According to Financial Planners

A widely accepted guideline for general retirement planning is to squirrel away at least 15 percent of your paycheck pre-tax. So, for example, someone making 60,000 a year (or $5,000 per month) should theoretically put away about $750 each month.

But, that plan doesn't account for the nuances of real life or associated financial demands, including the cost of living in your city, how many kids you have, and any major expenses—and those numbers can add up in retirement, too. "[M]ost people will be retired for at least a decade," says Emily Green, director of private wealth at Ellevest, an investment platform aimed at women. "That means a decade—or more—of everyday expenses, medical bills, and living your best retired life."

In short: The amount of cash you're saving for the future is dependent on myriad factors. But to make sure you're comfortable during that decade or more of post-office bliss, it pays (literally) to steer clear of some all-too-common retirement planning mistakes that experts see all too often. Below, Green and Alana Benson, investing spokesperson at personal-finance company NerdWallet, tell you what not to do along your quest to take care of yourself financially in the distant future.

5 retirement planning mistakes to avoid, according to experts

Mistake 1: Not starting to plan because you think you don’t make enough money

If you're telling yourself that you'll start contributing to your 401(k) after your next raise, Benson wants you to reconsider. "Even if your income is minimal, you should still think about retirement. Stashing some money away, even if it’s a small amount, can really benefit you in the long run," she says. Thanks to a little something called compound interest, or earning returns on the cash you've invested, saving even $50 per month could be major in the long run.

"Stashing some money away, even if it’s a small amount, can really benefit you in the long run." —Alana Benson, NerdWallet

For example, let's say you initially invested $100 and contributed $50 per month in an investment account that earned 12 percent in returns. Within a decade, you would have saved about $12,000 (meaning you've earned about $5,800 in interest). That's something. And, well, if you find a way to invest more than $50 a month, you'll stand to make a whole lot more cash.

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Mistake 2: Trying to do everything yourself

Finances can be complicated, so don't be afraid to defer to experts in the field if your budget allows. "For some people, retirement planning is fairly straightforward. But if you have a large estate, multiple accounts, various beneficiaries, or a complicated tax situation, it may be worth talking to a financial advisor who can help you stay organized," says Benson.

Ideally, these experts should be people who guide you in your specific situation, says Green. "We strongly recommend working with a financial planner or advisor to build a plan that’s as unique as you and your goals are, to give you the best possible chance of achieving them," she says. "Financial planners are not one-size-fits-all—and they shouldn’t say they are. Meet or vet at least two financial planners to make sure they are the right fit for you."

When you're choosing a financial advisor, Green recommends asking yourself the following questions:

1. Do the diversity values of the expert support your values?
2. Do they have the services you are looking for?
3. Can they meet you where you are?
4. Do they speak your language, or are they all speaking finance lingo?
5. Are they transparent about their fee structure?
6. Are they credentialed?

Mistake 3: Miscalculating the figure you'll need to retire

"You don’t want to underestimate how much money you’ll need in retirement, but you also don’t want to wildly overestimate," says Benson. "Overestimating means you get less to live off of now. Using a retirement calculator can help you come up with the right number for you."

Once you have a figure and a plan for meeting that figure, you'll need to do your very best to stick with it—no matter how the markets ebb and flow. "When the market becomes volatile, similar to what we’re experiencing now due to inflation and an impending recession, don’t switch your plan," says Green. "We don’t typically recommend changing your investing plan in response to market volatility. We believe that investing consistently, through up markets and down markets, is generally the best plan for a long-term goal."

Mistake 4: Not considering tax-advantaged accounts

While it can feel fun and exciting to play in the stock market, your tax-advantaged accounts—or retirement accounts that offer a tax benefit or tax exemption—always need to be your number one priority.

"The first place you should save for retirement is your employer-sponsored 401(k) plan, if you have one," says Green. "This money comes directly out of your paycheck before it hits your bank account, so you may hardly notice." This is especially important if your employer matches your 401(k). As Green notes, this is basically free money; don't miss out on it.

Once you've checked off the 401(k) box, you're going to want to look into individual retirement arrangements (IRAs) next. Contributions to these accounts offer tax-free growth on your savings.

Mistake 5: Thinking of retirement planning as a financial "chore"

Once your retirement planning strategy is up and running, you'll likely feel a sense of self-pride and security—and that can be empowering. "We all more or less get the concept of self care—taking time out of the day to take care of your mental, emotional, and physical health," says Green. "Maybe it’s time to put retirement and financial health in the 'self-care' bucket, and not just the 'financial chore' bucket, and start a routine that more obviously connects 'Today You' with 'Future You,'" says Green.