Will you outlive your money or will your money outlive you? This is a question that every retiree should know the answer to before they decide to retire, but more often than not they don’t. You might even be retired and reading this right now and have no idea. The good news is that you only need to know three things in order to answer the question, but getting the answer to all three could be difficult. This month we’re going to talk about the first thing you need to know, which is how long you’ll live.
Four out of five people when asked how long they think at least one person in the average 65 year old couple will live to will say it is less than 93. The reality is if both people are in good health and are non-smokers the majority of 65 year old couples will have at least one person live at least that long. A whopping 90% will have at least one person alive at 85 and nearly three quarters will at 90. Even if smokers and those in not so great of health are included; nearly half will still have at least 1 person alive at 90, according to the chart.
An easy way to not outlive your money is to not live long, which is not what most people retiring would view as an ideal way to deal with the potential problem of running out of money. If you’re retiring today and you’re in your early to mid 60’s, you need to understand that it is more likely than not that you or your spouse (if married) will be alive in 25 to 30 years. It may be hard to wrap your mind around the fact that if you’re in this situation you’ll probably need income to last nearly half as long as you’ve been alive so far all while not receiving a paycheck from working. It may be even harder to figure out if what you have is enough to last that long, which is where a good financial advisor can be of help.
Next month we’ll start diving into the second thing you need to know to answer the question of will you outlive your money or will your money outlive you, which is how much you will spend. If you don’t want to wait until next month to find that out or the following month to discover the answer to the third thing you need to know, you can schedule a complimentary meeting with someone from our team at Retirement Portfolios either through our website below or by calling 785-330-9292 as we help people make sure their money will last as long as they do.
Material discussed is meant for general/informational purposes and is not intended to be used as the sole basis for any financial decisions, nor be construed as advice to meet your particular needs. Please consult a financial professional for further information.
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