Joe Lucey

How much money do you need to retire? That’s about as personal a question as, “What do you look for in a spouse?” or “What is your dream job?” The answer is different for everyone.

So are questions about when you want to retire, how you want to retire (suddenly or gradually) and where you want to retire. There are vast combinations of these and many other variables that serve to make the style and level of retirement different for every individual — even within the same household.

Americans are retiring at a rate of 10,000 per day, which means a lot of people need retirement planning advice. Financial services firms like ours develop relationships with neighbors and friends in our local community to offer personalized guidance and advice on financial matters. If you’re pondering how much money you may need to retire, please come and see us. Not only can we help you with that assessment, we create financial strategies through the use of insurance and investment products to help you work toward your retirement goals.

Fidelity recently conducted a survey that yielded wildly divergent responses in terms of how much money people think they need to retire. For example, 25 percent think they will need to have saved two to three times their annual salary during their last year of full-time work, while many financial advisors say it’s more like 10 years’ worth of salary saved. Overall, 74 percent of Americans underestimate how much they will need for a comfortable retirement.

It’s important to keep in mind that issues may arise even if you’ve saved an appropriate amount for your household by the time you retire. Some circumstances — such as the unexpected death of one spouse before the other — could expose the need to replace a lost source of income. This is a possible circumstance where buying a life insurance policy, even long after your children have grown up and are on their own, may still be a part of your overall financial strategy, depending on your personal circumstances. At a minimum, one of the two Social Security benefits the couple was receiving will stop when one spouse dies. A life insurance payout can help augment any lost Social Security or pension benefits to help a surviving spouse maintain his or her current standard of living throughout retirement.

While some retirement factors are personal, others may be cultural in nature. The most current available data shows that in the U.S., the average white family has more than $130,000 in retirement savings while the average African American household has only $19,000. Over time, disparities in income and personal wealth have an even more dramatic impact: By the time they enter their 60s, whites have accumulated 11 times more in savings than African Americans — on average at least $1 million more in wealth.

Unequal pay and career opportunities also may impact a woman’s ability to save enough for retirement. To complicate matters further, women tend to live longer. A couple estimating how much they need to retire may make the assumption that they’ll need, for example, 25 years of retirement income. The husband might pass away after 15 years while the wife lives another 15 years on her own. However, their income plan may not reflect a loss of income sources once the husband dies nor increased expenses the surviving wife may incur in her later years of life.

If you’re interested in estimating about how much money you may need to save each year, try out an online retirement calculator, like this one provided by the U.S. Financial Industry Regulatory Authority (FINRA). You also can contact us to schedule a more in-depth retirement analysis.

The content provided here is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice. Contact us at info@securedretirements.com or call us at (952) 460­-3260 to schedule a time to discuss your financial situation and the potential role of investments in your financial strategy.

Every morning, Emma Morano ate a raw egg and biscuits. When she died at age 117 in April of this year, she was the oldest person in the world. She lived in Verbania, a picturesque town situated on Lake Maggiore in northern Italy.

Violet Brown, who was born in 1900 and lives in Jamaica, now holds the mantle as the world’s most senior senior. Like Morano, she resides in one of those beautiful locales that most of us only dream about. Could picturesque surroundings be a factor in longevity?

Surely happiness, time spent with good friends and family and a high quality of life can be factors. But no one really knows how long they’re going to live, which makes it particularly difficult to plan accurately for retirement income.

According to the Society of Actuaries, men who reach age 65 can expect to live to an average age of 86 and women to 88 — but those are just averages. In reality, some won’t make it to their predictive age and others will live longer. Which will you be?

As financial advisors, we understand the dilemma of planning for the unknown because it’s what we do every day. If we can help you develop a retirement plan, please contact us for a financial review.  We can help you stay focused on your long-term goals and work with you to design a specific plan using a variety of insurance and investment products that help you work toward your desired financial future.

One tool to estimate your lifespan is the Actuaries Longevity Illustrator. Based on a few simple questions regarding health and demographic characteristics, it offers a series of percentages predicting your chances of living to various ages.

If that’s too broad in nature, you might enjoy completing a more detailed questionnaire at the Biological-Age calculator. Based on how healthy a lifestyle you lead, this calculator knocks years off your current age for an estimate of how well your body is holding up.

The Living to 100 Life Expectancy Calculator (livingto100.com), which was developed by Dr. Thomas Perls, of the New England Centenarian Study, asks 40 questions about health and family history to help estimate how long you may live based on researched medical and scientific data.

If you’re concerned about getting older, here’s a bit of good news: People tend to get happier as they age. In a poll earlier this year, people age 70 and older said their quality of life has improved as they’ve aged. This could reflect the sentiment many people feel who either never enjoyed working or are simply happy to stop.

Either way, it’s probably more uplifting to stop thinking about the limitations of getting older, and reflect more on the advantages we can enjoy that were denied us at younger ages.

One of the difficulties people faced during the recession was the high level of unemployment. However, a long-term benefit is that some people became more flexible about what they were willing to do to earn a living.

College-educated millennials accepted unplanned forays into things like bartending, graduate school and opening their own small businesses. Many midcareer professionals who lost their job went back to school to study in a different field, thus launching the concept of pursuing two or more careers in a lifetime.

This lesson wasn’t lost on baby boomers; plenty of mature workers seized the opportunity to expand their knowledge and pursue a new career path. In fact, learning is one of those things that doesn’t have an age limit. College towns are generally considered great places to retire, where seniors enjoy a wide range of activities from auditing classes and guest lectures to attending cultural events to using the campus gym.

If you check out your local library, you’ll likely find a plethora of courses available in the community such as computer lessons, religious studies, arts and drama activities. If you don’t want to leave home, check out the wide range of options available online, such as the popular Master Class series that offers video courses taught by knowledgeable professionals and even celebrities.

Retirement is a great time to pursue an activity you have always been interested in and further your education. Lifelong learning opportunities also give older adults a way to meet other people with shared interests and create a regular schedule of activities and social engagement.

Most people have a subject they’ve always wanted to learn — how to play the guitar, dance the Tango, speak French — but were always too busy to truly pursue it. A great benefit of retirement is the time that’s available to finally help make those goals a reality.

Inflation appears to be moving up in some developed countries. In the U.S., inflation is measured by the consumer price index, which tracks the prices of about 80,000 items each month. 

This includes our most common household groceries such as cereal, milk, coffee and wine.

In Great Britain, economists have a similar measure called the retail prices index. Due largely to a rising number of small distilleries in the past few years, the Brits recently added gin to its monitored shopping basket.

After years of consistently higher sales, gin has joined the ranks of other British staples in tracking higher prices, thereby earning the moniker “ginflation.”

There are a lot of positives in economic growth, but one downside is the inflation that sometimes comes with it. An increase in the GDP rate, consumer prices and, inevitably, interest rates often follow as well.

In recent months, we’ve seen a jump in gas rates; home prices are rising at the quickest pace in nearly 10 years; and the rising cost of medical care — which had slowed down until this year — is back on the ascent. While today’s global markets and automation technology help keep price increases down on most consumer goods, inflation can still impact the long-term purchasing power of a conservative retirement portfolio.

That’s why some investors incorporate securities touted as “inflation busters” because they can provide ongoing income growth but are still considered low-risk instruments. Inflation-busting portfolio options could include:

• Treasury inflation-protected securities (TIPS) — Government-issued bonds that adjust principal value each month to align with inflation (or deflation).

• Floating-rate fund — This type of fund typically invests in variable rate bank loans issued to companies with substandard credit ratings. Because the interest rate adjusts according to a short-term benchmark, they offer ongoing income opportunity.

• Stocks as an asset class have historically outpaced the rate of inflation in the long haul. Yet some sectors weather an inflationary environment better than others. For example, the energy, industrials and materials sectors generally outperform more interest rate-sensitive sectors such as utilities and telecommunications during periods of rising inflation.

• Real estate has long been recognized as an inflation hedge, but some retirees don’t want to get into the business of being a landlord. One way to potentially reap the gains of real estate income without a direct investment is to explore the benefits and risks of a real estate investment trust (REIT), REIT mutual fund or REIT ETF.

The content provided here is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice.  Contact us at info@securedretirements.com or call us at (952) 460­-3260 to schedule a time to discuss your financial situation and the potential role of investments in your financial strategy.