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5 Ways to Decrease the Chance You’ll Outlive Your Money | Business

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5 Ways to Decrease the Chance You’ll Outlive Your Money
5 Ways to Decrease the Chance You’ll Outlive Your Money


5 Ways to Decrease the Chance You’ll Outlive Your Money

Americans are living longer. In fact, the average life expectancy today is roughly 78 years, compared to slightly less than 70 years in 1960, and just 49 years back in 1900. Clearly, modern medicine and technology have grown by leaps and bounds, giving us more years to do the things we love. But it also means that people may spend more time in their retirement years, which increases the chance that many people will outlive the money they have saved for retirement.

“Even though many people have tried to save a nest egg for retirement, economic challenges and a volatile stock market have lead to the shrinking of people’s savings and asset values,” explains Brad Glickman, a CERTIFIED FINANCIAL PLANNER TM Professional and president of Bernard R. Wolfe & Associates, Inc., a company that specializes in offering wealth management strategies. “When you combine this with the fact that people are living longer, it becomes crucial to form a plan to help your assets sustain you for the long haul.”

The economic downturn and housing market crash, along with bank institution problems, caused many people to find that the value of their IRAs, 401k’s, and nest eggs have shrunk. Combine this with the fact that fewer people are retiring with reliable pension incomes and many worry that they may not have enough to last them for the rest of their lives.

Here are a few simple steps you can take to avoid outliving your money:

  • Crunch the Numbers. Determine what income sources you’ll have at retirement versus what your proposed expenses will be at that time. There are online calculators that can be used to help determine whether what you have saved will be enough. Be sure to use a calculator that takes a reasonable inflation into consideration. $200,000 in today’s dollars, for example, won’t have the same purchasing power 20 years or more from now.
  • Live within your means. When you are earning a paycheck it’s not as scary to spend money or take on debt, but this often comes back to cause people pain during retirement. The less debt you have as you go into retirement, the more assets you’ll have to draw from. A CERTIFIED FINANCIAL PLANNER TM Professional can help you run calculations and determine how much annual withdrawals you can take from your nest egg during retirement without risking your principal in the long run.
  • Don’t rely solely on Social Security. Social Security is designed to supplement 35-40% of your retirement income, but for over 50% of Americans, it currently makes up more than half of their income. Talk to an advisor about additional ways to guarantee future income streams. Alternative investments that aren’t subject to the volatility of the stock market and variable annuities that offer income guarantees can help supplement your other income sources. Roth IRA’s can provide tax-free income and do not require withdrawals at age 70 ½ like most retirement accounts.
  • Be prepared to live longer. One of the ways you can protect yourself against the risk of living longer and needing care later on is to transfer the risk of those costs to someone else. While insurance can be pricey, there’s nothing that ruins a financial plan and depletes peoples’ nest eggs faster than large medical expenses or extended periods of long-term care costs.
  • Delay retirement and maximize social security. Because people are experiencing a longer span of retirement years, you may want to consider delaying retirement and continuing to work, especially if longevity runs in your family. Every year you delay drawing social security past your full retirement age, you get an 8% per year permanent raise in your benefit. At current rules, you can do this for up to four years. This could permanently increase your social security benefit by 32%.

“No matter what your stage in life, there are things that can be done to help start making your retirement more secure,” added Glickman. “We don’t want to outlive our money, so we need to take action now to help ensure that it doesn’t happen.”

Bernard R. Wolfe & Associates, Inc., has provided financial management strategies and investment services since 1981. They assist a wide range of private and corporate clients with everything from retirement and estate planning to investing and divorce planning.

About Bernard R. Wolfe & Associates, Inc.

Bernard R. Wolfe & Associates, Inc., founded in 1981, provides professional wealth management strategies and institutional investment services. The company is led by a team of Certified Financial Planners who have over 50 years of combined years of experience in the field. The team of professionals provides proficient financial planning guidance to a diverse range of personal and corporate clients. To learn more about Bernard R. Wolfe & Associates, Inc., visit the website at www.bernardwolfe.com.

Securities and Investment Advisory Services offered through NFP Securities, Inc. Member FINRA/SIPC.


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Centers for Disease Control and Prevention. Life Expectancy. <http://www.cdc.gov/nchs/fastats/lifexpec.htm>

Congressional Research Service. Life Expectancy in the United States. Page 6. <http://aging.senate.gov/crs/aging1.pdf>

More Rely on Social Security. Emily Brandon, U.S. News & World Report, October 27, 2011. http://money.msn.com/retirement-investment/more-rely-on-social-security-...