Retiring in 2026? 3 Mistakes to Avoid With Your Savings.

If you're gearing up to retire in 2026, you may be spending the next few months counting down happily in your head. Hopefully, though, you'll be doing a lot of financial planning as well.

It's important to decide when to claim Social Security ahead of retirement so you choose the filing age that works for you. It's also important to read up on Medicare if you'll be signing up for it once your career comes to an end.

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But one thing you can't neglect as retirement nears is your nest egg. It's crucial to assess your savings and make sure you're happy with what you've accumulated. But assuming you are, and that retirement is a go, it's equally important to manage your nest egg wisely. And that means avoiding these potentially huge mistakes.

1. Withdrawing from your savings without having a plan

Once you retire, you may want to start taking money out of your IRA or 401(k) to supplement your Social Security benefits. Or, you may want to hold off on claiming those benefits so you can grow them into a larger sum.

The money in your IRA or 401(k) plan is meant to be spent in retirement, so you shouldn't feel guilty about taking withdrawals. But you also shouldn't tap your savings without having a game plan.

Even if you've managed to save a lot of money, if you withdraw funds without thinking it through, you could deplete your nest egg in your lifetime. A better idea is to come up with a withdrawal strategy that works for you based on your asset allocation, life expectancy, and income needs.

The 4% rule has long been a popular withdrawal strategy used by financial professionals. It may be a good starting point for you to work with as you explore your options. That said, you may decide to start out withdrawing more or less than 4%, depending on your individual circumstances.

2. Dumping all of your stocks to reduce risk

Stocks tend to be a great wealth-building tool when you're trying to save for retirement. Once you're in retirement, it's generally advisable to scale back on stocks to minimize risk in your portfolio.

But that doesn't mean you should dump your stocks completely. Doing so could stunt your portfolio's growth during retirement, limiting you to smaller withdrawals.

Now the exact percentage of your portfolio you keep in stocks should depend on your income needs and risk tolerance. Some retirees may feel comfortable having 60% of their assets in stocks. Others might prefer to limit the stock portion of their savings to 20% or 25% so they can sleep at night. Think about what strikes the right balance for you.

3. Not moving a decent chunk of your money into cash

While you don't want to keep all of your retirement savings in cash, it's important to keep at least some of your nest egg in a savings account or CD ladder.

The reason? You never know when the stock market might undergo a prolonged slump. If you don't have cash on hand to ride out a downturn, you could risk having to sell assets at a loss.

If you're going to keep a larger chunk of your portfolio in stocks during retirement, then it's especially important to have extra cash on hand as a backup. Aim for two years' worth at a minimum if, say, 70% of your portfolio or more will remain invested in the stock market.

That said, if you'll be collecting a large monthly benefit from Social Security that's enough to cover the bulk of your expenses, you may be able to get away with having less cash on hand. You'll need to consider your income needs to figure out what's best to do.

You may be gearing up to embrace retirement in 2026. But make sure to avoid these savings-related mistakes so you don't start off retirement on the wrong foot.

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