The 7 top reasons you may retire poor. Things to avoid!

1. You're too busy keeping up with the Joneses

You can't spend your whole life pretending to be rich and then think you'll retire rich too. Living within your means isn't glamorous, but it is smart. And being smart is what will make you a wealthy retiree.

Rather than upgrading your smartphone every two years and your car every three, try being content with what you have. It doesn't matter if all your friends are remodeling their kitchens, if yours works perfectly fine, leave it be.


2. You're not saving enough money

When you're not spending money to constantly upgrade your toys, you'll have more money to save for retirement.

Failure to save enough money is a sure way to retire poor. Ideally, 10 to 15 percent of your income should be going into a retirement account each month.


3. Your savings priorities are all wrong

On the other hand, you could be saving money but have your priorities all wrong. Yes, college for the kids is important, but not at the expense of your retirement account. The kids can always get scholarships, jobs or even loans if absolutely necessary.

Make your retirement savings a top priority. Again, you should be setting aside 10 to 15 percent of your income in retirement accounts. Once you hit that level, you can start putting money in the kids' college funds.


4. You save your money in the wrong accounts

Another common mistake is putting retirement money in the wrong accounts. A typical savings account isn't going to cut it. Whole life insurance or an annuity aren't fabulous options either.

Instead, put that money in tax-sheltered retirement accounts such as 401k's or IRAs. These accounts come with tax benefits as well as stiff penalties for early withdrawals. That second part is an essential component of ensuring your retirement savings are still there at retirement time.


5. You finance everything

Rather than spend your money on interest, flex your self-discipline muscles and wait until you have enough saved up before buying whatever it is you want. If you keep yourself out of debt, you'll be amazed at how far you can stretch your paychecks. Then you can live comfortably now and bank enough to live comfortably in the future.


6. You've let your credit score go

Neglecting to maintain your credit score by making timely payments is a major mistake that can lead to destitute retirement years. If your number is on the low side, use these tips to bring up your score quickly.


7. You're a chicken when it comes to investments

Finally, no guts, no glory can apply to your investments.

Sure, you don't want to be dumb about your money; placing 100 percent of it in volatile stocks a few years before retirement is a good way to land you in the poor house. But at the same time, you want to be aggressive enough with your allocations to ensure your returns at least outpace inflation.