How Much Money will you Need in Retirement?
Have you underestimated?
What is enough? If you’re considering retiring in
the near future, you’ve probably heard or read that you need about 70% of your
salary to live comfortably in retirement.
This estimate is frequently repeated, but that doesn’t mean it is true
for everyone. It may not be true for
you. Consider the following factors:
Spending Habits: Do you spend only 70% of you salary now? Probably not.
If you’re like most, you probably spend 90% or more. Will your spending habits change drastically once
you retire? Most likely not. In retirement every day
seems like Saturday and spending often is increased.
Portfolio: Many
people retire with investment portfolios they haven’t review in years, with
asset allocations that may no longer be appropriate. New retirees sometimes carry too much risk in
their portfolios, which can result in wild income swings from the roller coaster effects of the market. Other retirees are super conservative investors, their portfolios are so
risk adverse that they cannot earn enough to keep up with even moderate inflation,
and over time, they find they have less and less purchasing power.
Heredity: If
you come from a family where people frequently live into their 80’s and 90’s
you may live as long or longer. Imagine
retiring at 55 and living to age 95. Do
you have an income stream that will last 40 years?
Health: Most
of us will face major health problems at some point in our lives. Think for a moment, about the costs of prescription
medicines, and recurring treatment for chronic ailments. These costs can eat away our retirement income,
even with a great health care plan.
Cory Payne
Beehive Insurance Retirement Planning
302 West 5400 South #101
Murray, Utah 84107
cpayne@beehiveinsurance.com
801-6856-6868
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