This Mistake Could Cost You $700,000 in Retirement Income
You'll often hear that saving for retirement on your own is important. The reason? Your senior living costs may end up being more expensive than you bargained for, and your Social Security benefits may not have the capacity to cover the bulk of them.
In fact, if you're an average earner, Social Security will only replace about 40% of your pre-retirement wages. Most seniors, however, need more like 70% to 80% of their former earnings to pay their living expenses and have enough money left over to maintain a comfortable lifestyle.
You have several choices when it comes to saving for retirement. You could open an IRA and send money into that account regularly or sign up for your employer's 401(k) plan and have contributions deducted automatically from your paychecks. But no matter which type of account you choose to save in, be sure to avoid one major mistake that could cost you hundreds of thousands of dollars in retirement savings.
Source Fool.com
