The economic recession of 2007 and 2008 hit many residents quite hard. Retired and those near retirement in New York were often hurt hardest as the values of many assets were decimated. Our New York estate planning lawyers appreciate that fears about outliving one’s money are very real for thousands of local residents.
Even without the current economic challenges, the process of figuring out exactly how much money one will need in retirement is inherently speculative. The U.S. Social Security Administration explains that a 50-year old man today is expected to live to age 82; for woman the average life expectancy is 85. Younger generations are expected to have life spans averaging 90 or 100 years. That is why figuring out ways to survive financially for the long-term is daunting for everyone, not just the retired or nearly-retired.
No matter what way you slice it, retirement planning is intimidating. That is probably why the latest research indicates that only 13% of Americans are on track to meet their retirement goals.
Last week Next Avenue published an interesting article that shares some tips to help ensure you do not outlive your money. Expectedly, the first suggestion is to act as soon as possible to put a retirement plan into place. The details of the plan will be different for everyone, but it must include consideration of a range of issues: do you have chronic health concerns; do you want to work in retirement; will you need to support other family members; and similar questions.
In addition, retirement planning requires one to think long and hard about what they truly want to do in their later years. Retirement doesn’t necessarily mean not working–it often means simply having the freedom to make your own choices about when and how to work.
The story suggests that it is important to have professional help from an estate planning lawyer, financial advisor, and perhaps tax experts. These individuals will be able to share information on more complex issues that must be considered, such as coming up with realistic projections about monthly retirement needs, total savings requirements, and the best tax saving strategies. In the past, financial planners often used the rule of thumb that one could withdraw 4%-5% of their investment portfolio each year without worrying about running out of money. That rule of thumb is less applicable in today’s economic environment, and so experts must be consulted to provide specific advice about how these money rules will play out today.
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