Avoiding a Retirement DisasterSubmitted by Financial Planning Solutions, LLC on April 18th, 2019
Recently we’ve been approached by a few prospective clients who are just about to retire and would like a financial plan. Most have worked hard for years and now want to stop working. They are unsure how many more years they will want or be able to work. They have some money saved but have never really figured out whether they have enough to retire.
We like to help every person that knocks on our door but unfortunately, we are not be able to help everyone. It’s usually because they waited too long to decide to plan for their retirement. Perhaps they followed advice of friends or family, contributed to their 401(k) but only up to the match and they never really thought about what it would take to retire or what would happen if they had to retire. Then, when they reach their late 50s or early 60s, they start to think about retirement.
People that are in their 20s, 30s or 40s have a huge advantage—time. They can be saving and investing for decades and watching their nest eggs grow and compound if they start early. But people who only get serious about retirement after their last child has finished college may have waited too long. There is simply not enough time and not enough income to set aside in the short period between turning 55 and 65 to ensure a retirement that involves no lifestyle changes.
In addition to starting late, there are several risks that most people never think about:
- Having to stop work earlier than planned due to disability or health concerns
- Unexpected medical costs in retirement
- Living far longer than expected
It is well documented that the majority of retirees stop work earlier than they plan and many have unexpected medical costs at some point. In addition, people are living longer which means they’ll need more money to live comfortably for many more years than they expect.
If you know someone who has been putting off getting started with their retirement plan, please encourage them to start now. They’ll have many more options—and be happier—than if they wait until their last year at work to start planning.
If you think they could benefit from our planning services, have them give us a call. We’re here to help.
Lyman H. Jackson
Financial Planning Solutions, LLC (FPS) is a Registered Investment Advisor. FPS provides this blog for informational and educational purposes only. Nothing in this blog should be considered investment, tax, or legal advice. FPS only renders personalized advice to each client after entering into an advisory relationship. Information herein includes opinions and forward-looking statements that may not come to pass. Information is derived from sources believed to be reliable. Information is at a point in time and subject to change without notice. Such information may not be independently verified by FPS. Please see important disclosures link at the bottom of this page.