Friday, August 21, 2009

The Good News is You’ll Live Longer…

Planning for retirement often requires a fine-tuned equation including such variables as where you plan to live, how many years you’ve worked and how much social security you can expect, health care expectations, long-term care, and especially your life expectancy. Well, part of that equation is about to change, because according to U.S. News and World Report the life expectancy in the United States has increased 1.4 years since 1997. 

It may seem like a small change, but the article reminds us that when planning for retirement “it’s also important to note that many people live far longer than average and life expectancy increases every year.” And time is the great equalizer, it seems.  The expectancy gap between the lifespan of men and women is closing, as is the gap between Caucasians and African Americans.

What this means is that if you planned for your retirement based on an equation from 10 years ago, you may need to revisit your plan with your financial advisor.  “Most financial advisers recommend budgeting for at least 20 years of retirement and preferably 30 years in case you do live into your 90s.” Planning this way means you may end up with a surplus, but “it’s better to leave something behind for your children than to use up your entire savings and have no income outside of Social Security.” 

And if you do think you may have a surplus to pass on to your children and grandchildren, our firm can help you protect your retirement income right now, AND for future generations.