Pre-Retirement Mistakes to Avoid

Retirement is often thought of as the finish line — but in reality, it’s the beginning of a new, complex chapter of your life. In the critical five years leading up to retirement, small mistakes can snowball into big problems.

The good news? With the right strategy, you can avoid these pre-retirement mistakes and step into your next phase with confidence. Here are the most costly blunders to watch for — and how to sidestep them.

1. Retiring From Something — But Not To Something

Many pre-retirees focus so much on leaving work that they forget to plan what they're moving toward. Golfing, fishing, and spa days sound great — but they won't fill decades of time with meaning.

Retirement isn't a vacation; it’s a reinvention. Your need for a sense of purpose, connection, and contribution doesn't retire when your paycheck does. Building a vision for your post-work life — hobbies, relationships, personal missions — can make the difference between thriving and feeling lost.

All those wonderful people you work with won’t have much to talk to you about six months after you retire. They won’t have time to go to lunch every week. They’ll be focused on their work. It’s not that they don’t like you, it’s just that they’re busy with other things. Coming to terms with that can be lonely.

One way to deal with this is to retire slowly – that is, to semi-retire. Find a way to work 3 days a week or 10 days a month. This keeps you engaged and earning an income while cutting back on your stress levels and giving you more time for travel or family. You might be able to do this with your current employer or take it as an opportunity to move into something new and exciting.

2. Thinking of Retirement as a Destination, Not a Journey

It’s tempting to think of retirement as a single goal: hit a number, have a party, ride into the sunset. But retirement can last 20 to 30 years — or longer.

Markets will change. Your health will change. Life will change. Instead of aiming for a static target, think of retirement as a dynamic journey that will require ongoing adjustments, resilience, and reimagining.

Think about having investments that will likely maintain their buying power — stocks are more volatile, but tend to retain their value over time. Fixed income products, like bonds or CDs, feel safer but over the long term may lose out to inflation. Having a healthy mix — a balanced portfolio — can smooth things out while maintaining your quality of life.

3. Chasing the "Paid-Off Mortgage" Myth

One of the most common goals is to have your mortgage paid off by the time you retire.

The truth? There’s no magic in a fully paid-off house.

Sometimes it makes sense to carry a low-interest mortgage into retirement to preserve liquidity or take advantage of tax strategies. Other times, eliminating debt creates powerful peace of mind.

The key is intentional decision-making — often with the help of an objective adviser — not chasing outdated milestones.