For Mark Roberts’ Use: A recent survey by GoBankingRates uncovered an alarming truth: More than half of all Americans will enter retirement without adequate income-generating savings. Hopefully, you will fall into the other half, and you will sail effortlessly into your retirement years. However, there is so much bad information out there, that anyone could be easily led astray. So we’re devoting this week’s blog to combating some of the more common myths regarding retirement.
“My cost of living will be lower in retirement.” In some ways, it costs a lot of money to be employed! You might face considerable expenses connected with your daily commute, your work wardrobe, lunches with clients, and so on. Many of us believe that our cost of living will decline once we retire. That could be true, but remember that you will now have an awful lot of spare time on your hands. You might want to fill that time with hobbies or travel, and those things aren’t cheap.
“Medicare will pay for all of my healthcare expenses.” When you turn 65, you will become eligible for Medicare. But you might be surprised to discover that the program does not cover 100 percent of retiree healthcare needs. You will still pay premiums, co-pays, and deductibles. You might also have to pay toward medications, equipment, or services that are not covered by Medicare. Experts predict that the average 65-year-old who retires today will spend about $320,000 on medical care over the course of their retirement years.
“Investing is too risky in retirement.” It is true that many retirees decide to switch to a more conservative investment strategy, to protect their principal. But because inflation can seriously erode your purchasing power over a decade or two of retirement, you might not want to rule out growth entirely.
“I don’t need a Will”. Because you’ve filled out a beneficiary form for every investment account and insurance policy, you might believe that you don’t need a Will. However, there are many end-of-life issues that are not covered by beneficiary forms, and everyone needs to discuss these issues with a skilled estate planning attorney in order to adequately protect themselves.
These are just some of the more common myths we have heard, regarding retirement. The main thing to remember is that it is easy to become too confident, and overlook something important. So remember to meet with us regularly, and we can help you put together a retirement plan based on current information and economic conditions.