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Four pieces of retirement advice you should question

The conventional wisdom is that you should wait until age 70 to take your Social Security benefits. But you aren’t a financial failure if you choose to take them early. (iStock)
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Whenever someone starts a sentence off with, “I’ve been told,” I get nervous.

This is particularly true when it comes to personal finance. There is so much you need to do to manage your money that it’s a good thing to get recommendations. But you need to consider the source and whether the advice is in your best interest, biased or appropriate given your personal circumstances and money style.

Here are four pieces of retirement advice that bother me:

1. “Don’t worry about carrying a mortgage into retirement.”

Maybe you don’t remember mortgage-burning parties, but I do. My grandmother Big Mama lived for the day she could get rid of her mortgage and greatly reduce her monthly expenses.

But these days, some experts encourage people to roll into retirement with a mortgage. They argue that any extra money that could be applied to reducing the mortgage principal should be invested instead.

However, consider the source. Is the advice coming from someone who stands to gain in fees and commissions if you invest in the market. Besides, market returns aren’t guaranteed. But you will definitely reduce the cost of borrowing by paying off your mortgage early.

I am not planning to retire with a mortgage. Think about it. If you are saving adequately for your retirement, why not get rid of the biggest expense you have in your budget.

I’m not advocating that you be “house rich and cash poor,” meaning all your money is tied up in the equity of your home. But, if you can, don’t drag a mortgage into retirement.

For more on this, read:

Yes, you should pay off your mortgage before retiring.

These retirees say: Pay off that mortgage before retiring.

2. “Your latte habit is keeping you from retiring a millionaire.”

Your morning coffee treat isn’t the main culprit behind your lack of cash to save for retirement. It’s more complicated than that.

“I’m one among many people who routinely point out that the idea Americans could solve their long-term financial woes by staying out of coffee shops and giving up avocado toast is a myth,” wrote Helaine Olen, a contributor to Post Opinions. “But it’s a myth that won’t die. There is, of course, nothing wrong with thrift. But it’s also true there’s a long tradition in the United States of avoiding the main problem when it comes to money. Women are told they are shopaholics, when in fact they earn and spend less than men, while African American young males find themselves lectured on sneaker purchases and not, say, housing discrimination and its large role in the low net worth of minority households."

Read: Why do we believe Americans spend too much money on coffee and avocado toast?

3. “Your child can borrow for college, but you can’t take out loans to fund your retirement.”

This advice sounds reasonable, which is that with limited financial resources you should save for retirement as a priority over putting aside money to send your child to college. But when I talk to folks who regurgitate this advice what they heard was: Don’t save for your child’s college education. He or she will be fine even if loans are needed.

The result is people think that it’s an either/or situation. They don’t save anything for their children to attend college or very little. Except when they realize their child can’t borrow enough on his or her own, the parent ends up taking out loans with monthly payments that disrupt their ability to save for retirement.

If you can, try to do both — save for retirement and put away money to eliminate or reduce the amount of student loans you or your child take out.


The psychological costs of student debt

The bottom line when picking a university: ‘No debt for our daughter or for us’

What people get wrong about 529 college-savings plans

4. “You should definitely wait to take your Social Security benefits at 70.”

The conventional advice about when to take Social Security is wait and collect at 70.

If you claim early at 62, rather than waiting until your full retirement age, there’s up to a 30 percent reduction in your monthly benefit. If you wait, every year you delay beyond your full retirement age up to 70, you get an 8 percent bump in your benefit.

There is a good case to wait since many people are living longer. The extra money every month could help pay for health-care expenses not covered by Medicare like long-term-care assistance.

Still, you aren’t a financial failure if you choose to take your benefits early. Maybe you can’t afford to wait until you are 70. Perhaps, you’ve run the numbers and figured collecting early means money in your pocket now to do things you may not be able to do in your 70s or 80s.

Weigh the advice of early or late and then make the decision that’s best for you.

Read more:

Early or late: One senior says ignore the conventional wisdom of waiting to take Social Security. Take it at 62.

The great Social Security benefits debate: Take it early or wait?

Your Thoughts

What retirement advice did you get that turned out to be wrong? Send your comments to In the subject line put “Retirement Advice.”

Retirement Rants and Raves

I’m interested in your experiences or concerns about retirement or aging. What do you like about retirement? What came as a surprise?

If you haven’t retired yet, what concerns you financially?

You can rant or rave. This space is yours. It’s a chance for you to express what’s on your mind. Send your comments to Please include your name, city and state. In the subject line put “Retirement Rants and Raves.”

In last week’s newsletter, I discussed a question from a reader concerned that her extreme frugality was keeping her from having enough fun.

Read: Could you be saving so much for retirement that you’re missing out on living your best life now?

I asked: Are you concerned that you’re so tight with your month that you aren’t having enough fun?

“My wife and I have struck a balance, we include fun money in our budget,” wrote Bob Durstenfeld. “We have no regrets. We raised three sons and got them all through college debt free. We have been able to afford a two-week vacation each year and have been to some unusual places. For us, travel and live theater have been a priority. When I was 57 I was laid off in a corporate downsizing. I have been unable to land full time employment since, that was 7 years ago. I am glad that we were ahead of our savings and had retired our mortgage.”

Stuart Massion from Hokkaido, Japan, wrote, “I have always enjoyed saving and investing and watching my nest egg grow. It has been almost a form of entertainment for me. A recent inheritance has put me way over my anticipated retirement asset requirements. I suppose I should be feeling all smug and happy but vividly remembering 2008 and seeing how decades of savings can go up in smoke has forever wiped that smile off my face. I now find myself involuntarily retired at age 60. Health conditions prevent [my wife and me] from enjoying many of the physical activities like hiking and traveling that we once enjoyed when we were younger and not so fixated on saving money. Yes, those wistful thoughts about forgone travel for leisure and family activities do plague me quite a bit. On the plus side, we live in a country which has universal health care, so we don’t have to worry about the highway robbery health care system we experienced in the USA.”

Andrea Fabian from Fairfax Station, Va., wrote, “We retired a little over a year ago. I did the calculations every which way to make as sure as possible that we would have enough money. Along the way, there were many things, trips, etc. that I said no to that my husband would have bought in a second. It isn’t that we didn’t do/buy anything, but we didn’t do/buy everything. Now that we are retired, the FOMO [fear of missing out] hasn’t gone away because the money has to last us a long time. I don’t feel I’m really missing out on anything. If it’s a strong want, I try to make it happen. The calculations are harder because there’s fewer inputs (no more salary) and I’m not in control of the market or the future of Social Security.”

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