From steady income to financial strain: Experts reveal costly retirement mistakes

Dubai: Experts have warned that many employees enter retirement facing financial pressures despite years of steady income, highlighting common mistakes that weaken financial stability after the end of working life.Specialists said many retirees rely almost entirely on their monthly salaries during their careers without building savings or investment plans, leading to difficulties when income declines after retirement and living costs continue to rise. In some cases, retirees also carry ongoing loans and long-term financial obligations, which further reduce their ability to maintain their standard of living.Common financial challengesExperts observed recurring patterns among retirees who previously enjoyed strong incomes but lacked long-term financial planning. Some individuals depleted end-of-service benefits or savings quickly due to poorly assessed investment decisions or unplanned projects.Dr Jihad FitrouniInsurance expert Dr Jihad Fitrouni identified seven major mistakes that contribute to financial instability after retirement. These include delaying retirement planning, relying solely on pensions or end-of-service benefits, underestimating inflation, and failing to diversify investments or income sources.He noted that postponing savings reduces the opportunity to benefit from long-term returns, stressing the importance of early planning and structured financial preparation.Need for diversified incomeEconomic expert Dr Jamal Al-Saeed highlighted additional risks, including over-reliance on pensions, excessive borrowing, and lack of financial reserves for emergencies or future needs such as healthcare or family responsibilities.Dr Jamal Al-SaeedHe said that successful retirement planning should be based on clear financial goals, regular savings, debt reduction, and diversified income sources such as well-planned investments or income-generating assets.Al-Saeed added that reviewing financial plans regularly is essential to ensure they remain aligned with changing economic and personal circumstances.Early planning essentialDr Abdullah Musa, a family arbitration expert at Dubai Courts, emphasised the importance of early preparation for retirement. He noted that delaying financial planning or taking on long-term obligations late in life can place additional strain on retirees’ finances.Dr Abdullah MusaHe advised adopting a long-term approach that includes savings, investment, insurance and the creation of emergency funds to ensure financial stability after retirement.Social impactExperts also pointed out that the effects of inadequate retirement planning extend beyond finances to include social and family challenges.Dr Saif Rashid Al JabriDr Saif Rashid Al Jabri, a professor of culture and society at several Emirati universities, said declining income combined with ongoing obligations can create pressure within families and affect stability. He also noted that retirees may face difficulties adjusting to changes in lifestyle and social roles after leaving the workforce.He emphasised the importance of planning at least 10 to 15 years before retirement to manage financial obligations and build sustainable income sources.Support initiativesThe General Authority for Pensions and Social Security has launched a retirement consultation service through the 'Maashi' digital platform to provide guidance on pensions laws and support individuals in planning for retirement.The Abu Dhabi Retirement Fund has also issued guidance encouraging retirees to understand social changes, maintain active lifestyles and adapt to new roles after retirement.Experts stressed that early financial planning, disciplined savings and awareness remain essential to ensuring a stable and sustainable quality of life after retirement.