Avoiding Common Investment Mistakes in Your University Retirement Account

In our last article, Active vs. Passive Investing: Which Is Better for Your University Retirement Account?, we explored different strategies to help you confidently manage your investments. Today, we’ll spotlight some common retirement investing mistakes University employees often make—and more importantly, how you can easily avoid them. At Provizr, we’re here to help you sidestep these pitfalls and build a stronger financial future. 

Why Mistakes Matter (and How to Avoid Them) 

Investment mistakes can significantly reduce your retirement savings over the years. The good news? Recognizing these pitfalls early and correcting course is easier than you think, and it can make a dramatic difference in your retirement outcomes. 

Let’s explore the top five mistakes—and how to fix them. 

Mistake #1: Not Maximizing University Matching Contributions 

One of the most costly mistakes is not contributing enough to your retirement account to receive the full employer match. Essentially, you’re leaving “free money” on the table. 

Simple tip: Always contribute at least enough to your 403(b) or 401(a) to capture your University’s full matching contribution. 

Mistake #2: Ignoring Investment Fees 

Fees might seem small initially, but they can significantly erode your returns over time. Even a seemingly minor fee difference can cost you thousands of dollars over decades. 

Simple tip: Regularly check your investment funds’ expense ratios (annual fees). Aim for low-cost options—typically below 0.50% annually—to keep more money growing in your retirement account. 

Mistake #3: Poor Investment Diversification 

Investing all your retirement savings in just one or two funds can put your entire retirement future at risk. Diversification—spreading your money across various investments—is crucial to managing risk effectively. 

Simple tip: Choose a diversified blend of mutual funds, ETFs, and annuities. This balanced approach helps stabilize returns and minimize risk over time. 

Mistake #4: Making Emotional Investment Decisions 

It’s natural to feel concerned during market downturns or overly optimistic when markets rise. But emotional reactions—buying high, selling low—can dramatically harm your long-term retirement savings. 

Simple tip: Stick to your long-term plan. Markets fluctuate, but consistency, patience, and discipline typically yield better outcomes over time. 

Mistake #5: Not Reviewing or Rebalancing Regularly 

“Set and forget” might be tempting, but your retirement investments need periodic check-ups. Without regular review and rebalancing, your portfolio could drift into unintended risk levels. 

Simple tip: Schedule an annual investment check-up to rebalance your retirement portfolio, ensuring it remains aligned with your desired risk level and retirement timeline. 

Real-Life Example: Alex’s Smart Moves to Avoid Mistakes 

Alex, a mid-career University employee, initially overlooked common investing best practices. But after attending a Provizr webinar, Alex corrected course: 

• Increased his contributions to capture his full University match. 

• Moved funds into lower-cost mutual funds and index ETFs. 

• Diversified across multiple fund categories and an annuity. 

• Scheduled annual portfolio reviews to rebalance as needed. 

Today, Alex is confident knowing he’s avoided costly mistakes and is positioned for financial security in retirement. 

Quick Checklist: Avoiding Common Investment Mistakes 

Keep this simple checklist handy as you review your University retirement investments: 

• Maximize employer match – Never leave free money behind. 

• Minimize fees – Lower-cost funds typically offer better long-term returns. 

• Diversify investments – Spread out your investments to reduce risk. 

• Stick to your long-term strategy – Avoid emotional reactions to market changes. 

• Annual review and rebalance – Keep your portfolio balanced and aligned. 

Common Questions Answered 

Q: How often should I rebalance my retirement investments? 

A: Generally, once a year is ideal. Rebalancing too often can add unnecessary stress and cost, while neglecting it entirely can increase risk. 

Q: What’s a good expense ratio? 

A: Aim for funds with expense ratios below 0.50%. Lower fees generally mean more savings growth over time. 

Q: What should I do during market volatility? 

A: Stay calm and remain committed to your long-term investment strategy. Regular, disciplined contributions often result in better long-term outcomes. 

Ready to Avoid More Mistakes? 

Learning to avoid these common investment mistakes is a big step toward financial security. To dive deeper and ensure you’re fully prepared for retirement, download our comprehensive Investing 101 Guide. 

Download the Investing 101 Guide 

Previous Article: 

Missed our previous article? Active vs. Passive Investing: Which Is Better for Your University Retirement Account? 

Coming up next in our Investing 101 series: 

“How and When to Rebalance Your University Retirement Portfolio”