Review: How to gauge your chances of a phased retirement

By | Retirement Risks, Retirement Income Funding, Reliable Income, Retirement Insights, Financial Planning, Weekly Review | No Comments

A lot of people expect to work past “retirement age.” They either figure that they will need the additional income to live, or they just enjoy their work and everything that comes with it. Planning to work in retirement is a dangerous game. Working longer can have a huge impact on your retirement situation – not only will you still have an income, but you also won’t be pulling money from your savings. However, almost half of retirees leave the workforce before they planned to, and of those who retired early, over half left because of a personal or family health issue. That should be terrifying if your retirement income plan hinges on you working into your 70s. If you want to work in retirement, that’s great. But you need to recognize it’s a risk. You may not have that option. You owe it to yourself to look at the situation rationally and understand just how feasible your plan is. While 70 percent of companies say they are “aging friendly,” that doesn’t really mean all that much. Frankly, I’m curious about the third of companies that said they weren’t “aging friendly.” You need to look at what your company and […]

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Review: Americans’ retirement benefits slashed by a quarter

By | Retirement Insights, Weekly Review, Insurance | No Comments

Preparing for retirement is hard. Especially as employer contributions have gone down over time. Since 2001, employer retirement benefit spending (pension and 401(k) contributions, as well as retiree health care) have dropped from 9.1 percent of worker pay to 6.8 percent of worker pay in 2015. (This is a 25 percent drop, but it’s not quite as dramatic as the headline makes it out to be since it’s spaced over 15 years.) During that time we’ve seen defined benefit pension plans all but disappear – employer spending on them has dropped to less than 1 percent of worker pay. It’s all on you now. What’s interesting is that health care (read health insurance) spending for current employees has increased more than retirement benefits have decreased. As of 2015, health care spending for current employees represents nearly two-thirds of all benefit spending. This means that you need to take charge of your own retirement planning. You are largely on your own. There’s a lot that goes into preparing for retirement, and it goes (far) beyond just throwing money at your 401(k) and IRA (though there are worse places to start). To find out what issues you should be thinking about, read […]

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