Do You Have Retirement Insurance?

We all pay thousands and thousands of dollars every year for insurance.  We buy insurance to protect our health, to protect our car and to protect our house.  But what about our financial wellbeing?   In particular, our retirement wellbeing.

Think about it. Retirement, based upon average longevity, can last 20+ years and for those lucky to live beyond the average age, 30+ years.  So, why not buy some protection.  Protection in the form of a holistic financial retirement plan prepared by an hourly, fee-only, fiduciary financial planner, a planner that will work with your best interest in mind.

A thorough financial plan should evaluate your resources, identify the potential financial risks and help you understand the tools available to maximize the potential for success.   The plan should incorporate investment management, cash flow budgeting, tax minimization, social security maximization and estate planning.

A good plan, by an hourly planner, may cost up to $3,000 -$4,000 but that is modest in compared to other insurance and over 20 years is only $150 per year, a bargain.   In the end, it should provide you with some peace of mind and protection against the unknown.

How I drive my wife nuts so we can spend more.

Retirement is all about resting, relaxing and enjoying, which is why you should care about your core expenses.  Core costs are those mandatory month-in and month-out expense that you must pay to live, e.g. property tax, food, utilities, insurance, healthcare, etc.  Discretionary expenses, on the other hand, are costs you can manage and reduce, either over the short or long term if necessary.   Typical discretionary expenses in include recreational costs (golfing), eating out, travel, charity, and personal care.

Core expenses in retirement (according to recent research) will continue to grow with inflation as it is what you need to live, while discretionary expenses (the “fun” expenses) tend to increase at first, peak and then decline in retirement as you age.

So, to maximize your fun in retirement and reduce your exposure to inflation, and at the same time help your retirement nest egg last longer, you should seek to reduce your core expense as you head into retirement.  And by doing so, as a bonus, you may be able to increase your discretionary (“fun”) expenditures. read more…

What is My Longevity and Why Do I Care?

Longevity is the length or duration of your life, and it is important in retirement planning because it determines how long your assets need to support you after you stop working.   Underestimating longevity is one of the most consistent mistakes my clients make when thinking about their retirement.

According to a 2012 report from the Society of Actuaries, if a male makes it to 65 there is a 40% chance he will live to age 85 and a 20% chance of living until age 90.  A female, on the other hand, has a 53% chance of making it to 85 and a 31% of making it to age 90.  And if they are a couple, at age 65 one of them has an almost 20% chance of making it to age 95.

So, to put it in a slightly different context, if you go to work at age 25 retire at 60 and live until 90.  You will spend almost as much time retired as you do work, which means longevity is critical in retirement planning.  If you do not save enough while working or if you spend too much in retirement you could outlive your resources.

If you would like to learn more about longevity or if you want to get a better idea of your longevity explore the links below.

Longevity Calculator:

All about Longevity – Stanford Center on Longevity:

Life Expectancy Data – CDC –

Society of Actuaries Report –