16 Retirement Mistakes You Will Regret Forever

16 Retirement Mistakes You Will Regret Forever

From saving too little to taking withdrawals from your retirement account too early, there are plenty of ways that current and future retirees can sabotage their golden years.

By Bob Niedt Contributions by Kathryn Pomroy, Alexandra Twin Last updated October 7, 2026 In Features

As more and more baby boomers and Gen Xers anticipate a happy retirement, thoughts turn from worry over the workday slog to concerns about how to bankroll their golden years. How prepared are you? How much money do you need to retire? The 2026 Planning & Progress Study by Northwestern Mutual says that number is $1.46 million.

Do you know the ins and outs of your pension (if you're lucky enough to have one)? How about your 401(k), IRA, and other retirement accounts that make up your nest egg? Do you have a good handle on when to claim Social Security benefits? These are just some of the questions to contemplate as retirement approaches.

Long before you punch out for the last time, make sure you're making the right choices now.

To help, we've compiled a list of the 16 biggest retirement planning mistakes you'll regret forever and how to avoid making them. Take a look to see if any sound familiar.

1. Relocating On A Whim

The lure of warmer climates has long been the siren call of many approaching retirement. So, you're cooking up a plan to retire in Florida, or maybe you're considering relocating to one of the many places near the beach.

Our advice: Test the waters and visit your destination before you make a permanent move.

Too many folks have trudged off willy-nilly to what they thought was a dream destination, only to find that it's more akin to a nightmare. The pace of life is too slow, everyone is a stranger, and endless rounds of golf and walks on the beach can quickly grow tiresome.

Well before your retirement date, spend extended vacation time at your chosen destination to get a feel for the people and the lifestyle.

This is especially true if you're thinking about retiring abroad, where new languages, laws and customs can overwhelm even the hardiest retirees.

You can also check out some of our helpful articles to learn more about things you should know before retiring in Florida, retiring in Arizona, or retiring in the Carolinas. And, as these areas are getting more popular, you can also read about some of the challenges (and costs) that might hit your wallet.

Along with that, before you buy a new home, either on the coast or inland, make sure you understand if your new house will flood in a storm. Flood insurance is expensive, if it's offered at all.

Once you do make the plunge, consider renting before buying. A couple I know circled Savannah, Georgia, for their permanent retirement nest. But wisely, as it turned out, they decided to lease an apartment downtown for a year before building or buying a new home in the suburbs. Good thing, too.

It turns out the Deep South didn't suit their Philadelphia get-it-done-now temperament. They instead joined the ranks of "halfback retirees" — people who head to the Deep South, find they don't like it, and move halfway back toward their former home up north.

2. Falling For Too-Good-To-Be-True Offers

Hard work, careful planning and many decades of working and building wealth are the keys to reducing stress for a secure retirement. There are no shortcuts. Yet, Americans lose hundreds of millions of dollars a year to get-rich-quick and other scams, according to the FTC, as elder fraud runs rampant. My parents constantly receive calls from scammers trying to persuade them to hand over their hard-earned retirement savings.

Credit card fraud was the most common type of identity theft in 2025 and is expected to reach $43 billion worldwide this year, according to Merchant Cost Consultant. Add in the 150 million Americans who will be victims of credit card fraud this year and the fact that every 14 seconds a person in the US falls victim to identity theft, it's enough to make your blood curdle.

State Attorney General offices and the FTC offer tips for spotting too-good-to-be-true offers. Telltale signs include guarantees of spectacular profits in a short time frame without risk; requests to wire money or pay a fee before you can receive a prize; or unnecessary demands to provide bank account and credit card numbers, Social Security numbers, or other sensitive financial information. Oh, and those pesky phone calls for donations to the police or fire department could also be a scam.

Be wary of — in fact, run away from — anyone pressuring you to make an immediate decision or discouraging you from getting advice from an impartial third party. If they want your money, they can mail you an envelope.

What do you do if you suspect a scam? The FTC advises searching for the company or product name, along with "review," "complaint," or "scam," on Google or another search engine. You can also check with your local consumer protection office or your state attorney general to see if it has fielded any complaints. If it has, add yours to the list. Be sure to file a complaint with the FTC, too.

3. Planning To Work Indefinitely

The 2026 reports from both Transamerica Life and Money: Retirement Security in the USA (PDF) and Employers, Workers, and the New World of Work confirm that 44% of workers expect to retire after age 65 or not retire at all — with Baby Boomers remaining among the most likely to work longer.

But that plan could backfire.

Consider this: Fidelity’s 2026 State of Retirement Planning survey showed that more than six in ten Americans (61%) plan to continue working in some capacity as they transition into retirement, with many phasing into retirement via part-time work, consulting, gig work or side hustles indefinitely.

Or, you could be forced to stop working and retire early for any number of reasons. Health-related issues — either your own or those of a loved one — are a major factor. Employer-related issues such as downsizing, layoffs, and buyouts are also a factor.

Failing to keep skills up to date is another reason older workers struggle to get hired. The actionable advice regarding this: Assume the worst, and save early and often.

Per the Transamerica survey, almost four in 10 workers expect to retire at age 70-plus, while 23% do not plan to retire at all, citing financial and healthy-aging reasons for doing so.

Although working past retirement age may be necessary, it could be a mistake you regret down the road.

4. Putting Off Saving For Retirement

In Northwestern Mutual’s 2026 Planning & Progress Study, nearly one in four Americans (23%) who have retirement savings say they have one year or less of their current income saved for retirement. For Gen Xers, many of whom are approaching retirement, one-third have 3x or less of their current annual income saved.

What is even more concerning is that while significant differences exist across generations, about 1 in 5 of each believe they will never be financially independent.

The truth is, while many retirees understand they should save for retirement, many have no idea how much money they will need to retire comfortably.

"Many people do not start to aggressively save for retirement until they reach their 40s or 50s," says Ajay Kaisth, a certified financial planner with KAI Advisors in Princeton Junction, N.J. "The good news for these investors is that they may still have enough time to change their savings behavior and achieve their goals, but they will need to take action quickly and be extremely disciplined about their savings."

Here's how much you need to sock away monthly to build a $1 million nest egg by age 65, according to Dutch Point Credit Union. Assuming an annual interest rate of 8%, an annual inflation rate of 2%, and $0 in prior savings, you'd need to save $300 a month if you start at age 25; $700 a month, starting at age 35; $1,700 per month, starting at age 45; and $3,000 each month, starting at age 50.

Uncle Sam offers incentives to procrastinators. Once you turn 50, you can start making catch-up contributions to your retirement accounts. In 2026, older savers can contribute an extra $8,000 to a 401(k) (up from $7,500 last year) on top of the standard $24,500, up from $23,500 in 2025.

In addition, people aged 60 to 63 can make “super” catch-up contributions of up to $11,250 in eligible workplace retirement plans on top of the standard limit and any regular age-50+ catch-up.

For IRAs (Traditional or Roth), the catch-up amount for those age 50 and older is $1,100, on top of the standard contribution limit of $7,500 (for a total of $8,600).

5. Claiming Social Security Too Early

You're entitled to start taking Social Security benefits at 62, but you might want to wait if you can financially. Most financial planners recommend holding off at least until your full retirement age (FRA) — 67 for anyone born after 1959 — before tapping Social Security. Waiting until 70 can be even better.

Let's say your full retirement age, the point at which you would receive 100% of your benefit amount, is 67. If you claim Social Security at 62, your monthly check will be reduced by 30% for the rest of your life.

But if you hold off, you'll get an 8% boost in benefits each year between ages 67 and 70 thanks to delayed retirement credits. There are no additional retirement credits after you turn 70. Claiming strategies can differ for couples, widows and divorced spouses, so weigh your options and consult a professional if you need help.

"If you can live off your portfolio for a few years to delay claiming, do so," says Natalie Colley, a financial analyst at Francis Financial in New York City. "Where else will you get guaranteed returns of 8% from the market?" Alternatively, stay on the job longer, if feasible, or start a side gig to help bridge the financial gap. There are plenty of interesting ways to earn extra cash these days.

6. Borrowing From Your 401(K)

Taking a loan from your 401(k) retirement savings account can be tempting. After all, it's your money. As long as your plan sponsor permits borrowing, you'll usually have five years to pay it back with interest.

But short of an emergency, tapping your 401(k) is a bad idea. It's one of the eight worst 401(k) mistakes you can make that could tank your retirement.

According to Meghan Murphy, VP, Commercial Strategy at Fidelity Investments, you're likely to reduce or suspend new contributions during the period you're repaying the loan.

That means you're short-changing your retirement account for months or even years and sacrificing employer matches — free money. You're also missing out on the investment growth from the missed contributions and the cash that was borrowed.

”As you think about loans from retirement plans, the first thing we say is, is there anywhere else you might be able to borrow from?” says Murphy. “We think through the importance of having an emergency fund.

But, of course, if that’s not available, is there any other place that you’re able to draw from? Something you might want to think about is: if it’s a medical emergency, do you have a health savings account (HSA) that you might be able to take money from?”

What’s becoming more popular, says Murphy, is employees drawing money from stock plan options through their employer. “If you draw money from there, there’s not necessarily a penalty associated with it or the requirement that you have to make payment on the loan directly through your paycheck.”

Another huge downside to borrowing from your retirement plan is the payback. Usually, loans are paid back to the fund over five years. If you were to leave that employer before the loan is paid off, you’re obligated to pay it back in full within 60 to 90 days, says Murphy, or it becomes a taxable distribution. “And if you’re below the age of 59-1/2, there’s now a 10% tax penalty associated with it.”

Keep in mind, too, that you'll be paying the interest on that 401(k) loan with after-tax dollars, then paying taxes on those funds again when retirement rolls around. And if you leave your job, the loan usually must be paid back in as little as 30 days. Otherwise, it's considered a distribution and taxed as income.

Before borrowing from a 401(k), explore other loan options. College tuition, for instance, can be covered with student loans and PLUS loans for parents. Major home repairs can be financed with a home equity line of credit (HELOC), though that comes with considerable risks, too.

TO READ MORE:  https://www.kiplinger.com/slideshow/retirement/t047-s001-retirement-mistakes-you-will-regret-forever/index.html