FINANCIAL FOCUS
• Income – Your biggest threat to an enjoyable retirement is the possibility of running out of money. This fear is apparently widespread; in a survey commissioned by Allianz, a life insurance company, more than 60% of respondents said they were more scared of outliving their assets than they were of dying. You need to create a retirement income strategy that incorporates, among other elements, a withdrawal rate that allows you to take money from your 401(k), IRA and other investment accounts in such a manner that you don’t run out. You’ll also need to answer other key questions, such as when to take Social Security – as you may know, the longer you wait, the bigger your monthly checks, until they “max out” at age 70.
Retirees Need a “Longevity Strategy”
The late, great Yogi Berra supposedly said it: “The future ain’t what it used to be.” And the same could be said of retirement. Due to several factors, such as advances in health care, today’s retirees are living longer, more active lives than their predecessors. In fact, you could spend two, or even three, decades in retirement – which means you need a “longevity strategy.”
Such a strategy needs to be part of your overall retirement income strategy, but here are five key areas you’ll need to address:
• Lifestyle – What do you plan to do during your retirement years? Travel the world? Stay close to home and pursue your hobbies? Volunteer? Open a small business or do some consulting? Your choice of lifestyle will probably affect every aspect of your longevity strategy.