In some ways, retirement has more financial complications than working life. Most retirees just want to relax and live off the money they've saved without worrying about a financial plan, but that attitude can lead to serious problems -- up to and including running out of money in mid-retirement. Here are some of the most common retiree money mistakes and how to avoid them.

Skipping tax planning

As a retiree, you'll have numerous tax complications to juggle -- estimated quarterly tax payments, paying taxes on your retirement account distributions, Social Security benefits taxes, capital gains taxes on investments sold from standard brokerage accounts, etc. Finding ways to minimize taxes before you make any financial moves can save you a ton of money, allowing your retirement income to stretch a lot further.

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Investing too conservatively

Given the way that the stock market can yo-yo up and down unexpectedly, many retirees are understandably reluctant to keep their money in stocks. However, moving all your money into bonds and other conservative investments means that your returns will moderate. A portfolio of bonds and cash likely won't even keep up with inflation, let alone allow your money to grow. Unless you have a huge amount saved and live very frugally, that's a sure ticket to Brokeville.

Retirees need to allocate their assets in a way that allows them to compromise between high risk and high returns. You can use the formula 110 minus your age to determine what percentage of your portfolio should be in stocks, with the remainder in bonds, and perhaps a small percentage in cash equivalents. So a 70-year-old retiree would have 40% of their portfolio in retiree-friendly stocks, with the other 60% in bonds and cash equivalents.

Not budgeting for healthcare

Healthcare is expensive for everyone, but it gets really expensive for retirees, who tend to have more and more health issues as they age. One study found that a 65-year-old couple retiring today will spend an average of around $404,000 in healthcare expenses, and that figure is likely to keep right on climbing.

Choosing the right Medicare plan can help a lot in keeping healthcare expenses as low as possible. However, you'll still need to reserve a large chunk of your budget for healthcare expenses.

If you're fortunate enough to be in good health and don't need to spend the money you reserved for medical expenses, you can save it for a future year when you won't be so lucky. Also, consider purchasing a long-term care insurance policy. Given the high cost of long-term care and the likelihood that you'll need it at some point, such a policy can be a good investment.

Skipping your estate planning

Retirees must face the fact that they have to start thinking about what will happen after they're gone. Estate planning isn't exactly pleasant, but it can make a huge difference in your beneficiaries' quality of life. They'll already be under stress while they deal with your passing; if you've taken care of as much of the legal and financial hassle in advance as you can, you'll relieve at least some of that stress.

At a minimum, retirees should make sure that they have an up-to-date will, a power of attorney in case they become incapacitated, and updated beneficiary information on all financial accounts. Retirees with substantial assets or complex estates should consult an estate planning professional to get advice on more sophisticated options, such as setting up one or more trusts.

Getting help for free

Given all the financial complications retirees must deal with, the best course of action can be to find someone who can help. Luckily, there are some resources that retirees can turn to for little or no expense.

The IRS has a free program, called Tax Counseling for the Elderly (TCE), offering tax planning and preparation advice. The agency's website boasts a locator tool to help you find the nearest TCE provider. The AARP also has a Tax-Aide program with free tax advice, including a website where you can submit a tax question year-round and get answers.

In many areas, attorneys will provide free legal services to those in need. However, it's a good idea to first confirm that the attorney in question is familiar with retiree and estate planning issues. Your local senior center may also be able to help hook you up with a financial professional at low or no cost. It's certainly worth asking -- after all, what do you have to lose?

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