Retirement in the 21st century won’t look like our parents’ or grandparents’ retirement. New rules have come into play, which I believe should be considered for individuals to have the potential for a more comfortable retirement.
You will live longer. Average life expectancy—how long one lives from birth to death—according to the 2008 National Center for Health Statistics is 85 years for women and 82.2 years for men born in the United States.
Retirement is a new stage of life. Not that long ago, people worked late into their life, retired to a rocking chair for a few years, and died. Today, not only are people living longer, many are retiring early. Retirement has become a stage of life that can easily last 30 years—or more!
Retirement is on your dime. Most of us will have to fund an ever-increasing portion of our retirement—or try to scrape by primarily on Social Security.
Social Security will be there, but… it is likely to change. Most financial planners have been advising their clients for some time not to base much of their retirement plan on Social Security. Yet for around 22 percent of those over age 65 today, Social Security is their sole source of retirement income, according to the Social Security Administration.
You may need to work in retirement. That may sound like an oxymoron, but retirees are returning to the workforce. Sometimes it’s for the money, but I’ve found it’s also because retirees are looking for emotional and intellectual stimulation.
Health care costs could kill you. The Employee Benefits Research Institute says that medical costs for retirees is actually five times higher than what near-retirees believe they will be.
You may need to prepare for long-term care. With people living longer, chances increase that you’ll need long-term care at some point [July 2004 Observer], either at home, in a nursing home, or at an assisted-living facility.
For more information contact Rebecca Robins, CPA/PFS, CFP®, at 661-702-9680, located at 25001 The Old Rd, Stevenson Ranch, CA 91381, CA Insurance Lic#0D75745.
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