Marta Norton, chief investment strategist at Empower, sees two retirement savings mistakes come up again and again. The first is not contributing enough to a 401(k), especially when workers fall short of the amount needed to receive their employer’s full matching contribution. One study estimated that Americans leave about $24 billion in unclaimed 401(k) matches on the table each year, which Norton calls the most obvious mistake. The second is carrying too much stock exposure, particularly among people managing their own retirement investments. A Fidelity report found that more than a quarter of baby boomers held a more aggressive stock allocation than recommended for their age. For people nearing or in retirement, a heavy equity position can leave savings exposed to a sharp market correction. It also raises sequence of returns risk, where withdrawals during a downturn lock in losses. The takeaway is to capture the full employer match and make sure your allocation fits your timeline and goals.
