Tag Archives: Retirement

Retirement Concern: How to Alleviate Four Common Fears for Retirees

Posted on by

Source: TD Ameritrade’s The Ticker Tape 

https://tickertape.tdameritrade.com/retirement/reduce-common-retirement-concerns-fears-17461

1. Investment Loss

One of the biggest financial fears retirees may have is investment loss. Because the markets move cyclically, there’s a good chance you’ll experience a market downturn during retirement. This can be doubly painful if you’re a retiree, because you have little choice but to sell at a loss for the capital you need. For retirees this is called “sequence of return risk,” because withdrawing investments in a down or declining market may cause you to liquidate too many shares, which then leaves fewer shares to grow when the market bounces back.

2. Running Out of Money

When you’re younger, a market decline can be weathered in multiple ways: perhaps by saving more, working longer, getting a second job, or just waiting it out because you won’t need to use your savings for years. But once you’re close to or in retirement, running out of money becomes a serious concern. Few people would want to go back to work at age 95 because they ran out of money. Fortunately, the flooring strategy helps here too. Lifetime income means just that: an income stream that’ll last no matter how long you live. By deploying annuities and other lifetime income strategically—just to meet your essential expenses—you can cover basic needs and avoid becoming a burden to your kids or others.

3. Major Health Event

As we get older, it’s common to see an increased need for health care. It’s natural, as a retiree, to worry about a major health event that can set you back financially. But it’s possible to prepare to some degree for such events.

4. Inflationary Effects

Inflation is sometimes considered the “quiet killer” of retirement. Over time, prices rise, making your money less valuable. A dollar today is worth more than a dollar tomorrow. Keeping up with inflation is an important part of retirement planning.

Planning Matters

One of the best things you can do for yourself is to plan ahead. Meet with a retirement specialist to create a plan that might help you avoid unpleasant surprises in the future. The earlier you start, the more likely you are to avoid the common fears faced by retirees. Having a plan in place and making consistent contributions to a retirement portfolio can go a long way.

 

What Is Financial Health? – Morningstar Blog

Posted on by

When evaluating a client’s “financial health,” advisors should take into account both economic stability and emotional well-being.

Emotional health is wreaking havoc on their finances. Some clients may be financially well-off, but so fearful of making a wrong choice that they don’t make any, leaving their wealth to slowly erode in cash accounts. Then there are clients who spend too freely, choosing blissful ignorance about potential damage to their bottom line.

Neither of these types of clients are financially healthy—regardless of wealth—because an individual’s attitude toward finances is just as essential to overall health as it is to the economic aspects of one’s life. In fact, the American Psychological Association  reports that money is continually one of the top sources of stress in U.S. households, regardless of the economic climate. 

It’s time to redefine the term “financial health” so it includes both a person’s economic stability and emotional well-being around his finances.  

— Read on www.morningstar.com/blog/2019/04/11/financial-health.html

Should You Try Timing to Avoid Bad Markets? – Retirement Researcher

Posted on by

Everyone likes the markets when stocks are going up. We’re all getting the returns that we are “supposed” to be receiving for putting our money at risk. Naturally, we aren’t big fans of the market when stocks start falling. Unfortunately, stocks are “supposed” to go up and down – a lot.

The financial markets are based on the relationship between risk and return. We wouldn’t be able to harvest the long-term returns we expect without the risk. And, well, this is what risk looks like.
— Read on retirementresearcher.com/occams-should-you-try-timing-to-avoid-bad-markets/

3 Secrets to Retiring Rich

Posted on by

Your ideal retirement may involve a lot of travel, the purchase of a few big-ticket items, and decades of worry-free, work-free days. But it’ll take a large nest egg to get there.

If you want to to retire wealthy enough to achieve your goals, you have to begin planning immediately. Start with these three steps.

Click on link below to read entire article.

apple.news/ArS5WUvycTlGxqinL5ZOQAQ

Nine Charts about the Future of Retirement | Urban Institute

Posted on by

Social Security cuts, shrinking employer-sponsored pensions, low savings rates, and longer life spans have raised fears of a looming retirement crisis. But other trends point to better retirement outcomes, such as women’s increased employment and earnings, longer working lives, and economic growth that raises wages.

— Read on www.urban.org/features/nine-charts-about-future-retirement

How grim is the future of retirement? – MarketWatch

Posted on by

Dire jeremiads about America’s looming retirement crisis are so common that it seems “retirementcrisis” is one word. The doom-and-gloom narrative goes something like this: Spendthrift Americans aren’t saving enough, so their living standards will plunge in retirement, and Social Security will buckle from the financial strain of too few workers supporting too many retirees.

Dark visions about retirement in America may be somewhat understandable considering the following: the nation’s deeply flawed retirement savings system; the forecast that Social Security’s reserves will run out in 2035 and the fact that local government retirement systems’ obligations to public sector retirees are increasing faster than the assets set aside to pay for them.

Depressed? Then take a moment to learn about a new report by the nonpartisan Urban Institute think tank: “Nine Charts about the Future of Retirement.”
— Read on www.marketwatch.com/story/how-grim-is-the-future-of-retirement-2019-08-06

The biggest bull market ever — yet disaster looms for millions of retirees – MarketWatch

Posted on by

The coming ‘tsunami of poverty’ for retirees — and what to do about it.

The wealthiest 10% of households own 84% of all stocks—and that includes pension plans, 401(k) accounts and individual retirement accounts (IRAs) as well as trust funds, mutual funds and college savings programs like 529 plans. That means 90% of American households own the remaining 16% of all stock.
— Read on www.marketwatch.com/story/the-biggest-bull-market-ever-yet-disaster-looms-for-millions-of-retirees-2019-07-18