As life spans continue to increase, so does the need for more money later in life. On this week’s episode of the Retirement Reality Podcast, Mike Kojonen explains how to plan financially for a long life.
The Reality of the Matter:
People are living longer and longer, which is a great thing but can be risky financially. On this episode of the Retirement Reality Podcast, Mike Kojonen explains how to plan financially for a long life.
“That’s one of the biggest issues – people are running out of money before they’re running out of life,” said Mike.
We always ask clients how long their parents lived and what their health was like. It may be an uncomfortable conversation, but if you retire at 60 or 65 and live another 30 years, you need a plan for how to support yourself financially.
We like to plan for the worst and hope for the best. We like for our clients’ money to hopefully last to age 100. That gives them an extra buffer. The two biggest fears retirees have are running out of money and being a burden on their children.
It’s important to look at your full retirement income, including pensions. Some don’t increase at all, and others lag behind inflation. How the cost of living changes as you age is important. You also need to think about health care costs, including long-term insurance and unexpected medical bills.
Listen to the full episode or use the timestamps below to find a specific segment, including two mailbag questions from listeners.
1:05 – Let’s talk about longevity
2:40 – Oldest clients
4:33 – Oldest family member
5:44 – Why is living long a risk?
8:44 – Are people prepared for longevity question?
11:05 – People afraid of running out of money
14:00 – Mailbag: should I cash out life insurance policies?
16:04 – Mailbag: How to prepare financially to leave job?
Thanks for checking out the Retirement Reality Podcast. We’ll talk to you again next week.