Retirement in the 21st century won’t look like our parents’ or grandparents’ retirement. New rules have come into play that 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, rose to 77.6 years (80.1 years for women, 74.8 for men) for people born in the United States in 2003, according to the Centers for Disease Control and Prevention.
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 20 to 30 years or more.
A secure 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, I believe chances increase that you’ll need long-term care at some point, either at home, in a nursing home or at an assisted-living facility.
Securities offered through Associated Securities Corp. (ASC), member FINRA/SIPC. Advisory services offered through Associated Planners Investment Advisory, Inc (APIA), ASC, David S. Reinders, CFP, Inc., Registered Investment Advisors. David S. Reinders, CFP, Inc. is not affiliated with ASC or APIA.
For more information, contact Rebecca Robins, CPA/PFS, CFP™, CA Insurance Lic#0D75745, at 661-222-2331.