If you haven't saved enough, then work longer. If you can't afford what you are spending now, how will you be able to afford a comfortable retirement?
The ideal design for tomorrow's retiree is enough cash to last two to five years plus investments to handle another 25 to 35 years. Yes, one out of every four us will live into our 90s. Does your plan consider this?
As we turn gray, our plans and our portfolios should not also turn gray. Retirement is a 30-to-40-year-long event. Most people want their money to last a little longer than they do.
But your money will not last the duration of a pretty much average retirement if it is grayer than you are. In other words, if your financial assets are suited for an 85-year-old, appropriately mostly in CDs, then those assets are likely to have the life expectancy of an 85-year-old. If you are in your 50s or 60s, then assets suitable for an 85-year-old will run dry for you before you'd like, well before you'd like.
As we approach retirement we want our assets and our plans to be robust and energetic and capable of sustaining us, including our increased medical costs, until the very end. Our assets have to be in line with our life expectancy and not with our emotional temperament at the moment.
If your financial picture is grayer than you are, then you may benefit from some professional help. And I don't mean a hair colorist.
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Donald E. Askey, a Certified Financial Planner™ professional and president of Provident Advisory Group, is a registered fee-only adviser, headquartered in Newburyport. For questions, visit www.providentadvisory.com.