**Retirees Risk Financial Stability with These 7 Critical Money Mistakes**

The 2024 presidential election spotlighted inflation’s impact, a pressing concern for American seniors. However, beyond the rising prices at grocery stores and restaurants, retirees face even more significant financial risks due to their own decisions. Here are seven money moves that could jeopardize your retirement.

One major error is relying on home equity as the primary source of retirement savings. For example, if someone sells a Chicago home and nets $400,000, then moves to a two-bedroom apartment in Lincoln Park where rent averages $3,450 monthly, they will spend $41,400 annually. This approach would deplete their equity in under 10 years, leaving them without an asset to pass down to family.

Another common mistake is relocating without thoroughly researching the new area. Florida, while a top retirement destination, poses financial challenges due to high home insurance costs driven by frequent hurricanes. Some places like Hialeah have average annual home insurance premiums as high as $17,606, according to Insurify, and additional flood protection could increase this by $2,472 per year.

Elder scams also present a significant threat. The FBI identifies schemes like romance scams, tech support fraud, and the grandparent scam, which has become more insidious with AI voice cloning. Sophisticated software can now mimic a loved one’s voice using only small audio samples, making these scams more convincing and damaging.

Relying on post-retirement work to cover expenses can be risky. The 2022 U.S. Federal Reserve Survey of Consumer Finances suggested that just 54.4% of American families have a retirement account. Health issues, particularly the high incidence of falls among seniors reported by the U.S. Centers for Disease Control and Prevention, can further complicate the ability to work during retirement.

Many retirees also face unexpected travel and leisure expenses. Surveys like the Employee Benefit Research Institute’s 2024 Retirement Confidence Survey reveal that over a third of retirees spend more than anticipated on these activities. This often leads to debt, with federal data showing a rise in unsecured debt among those aged 65 and older from 25% in 1989 to about 40% in 2019.

Taking Social Security benefits too early is another costly error. For instance, starting benefits at age 62 can reduce monthly income by 30%. Delaying benefits until age 70 can increase the monthly amount by 32%, emphasizing the importance of timing in retirement planning.

Lastly, borrowing from a retirement fund can have long-term repercussions. As retired journalist Bob Niedt noted, money taken from retirement accounts loses the potential growth from compound interest and investments. Alternatives like parent PLUS loans or debt consolidation loans should be explored first to avoid this pitfall.

Understanding and avoiding these seven financial errors can help retirees secure a more stable and comfortable future.