Could Living a Long and Healthy Life Leave You Without Money in Retirement?

Could Living a Long and Healthy Life Leave You Without Money in Retirement?

retirement planWill I have a long retirement? Should I live longer than average will I have enough money to support myself in retirement? Am I saving enough for retirement? These questions are key when you’re deciding how much money to save for retirement in order to live comfortably and have enough money for your entire lifespan.

Obviously, no one knows how long their life will be, although it’s possible to make an educated guess. The most important thing about life expectancy is to save enough money before you retire so that you have enough money to support yourself for the entire time you’re retired. After all, it could be 30 or 40 years.

Retirement Plans

There are a variety of considerations when working at making a retirement plan, but life expectancy is an enormous factor. People used to think that they’d be lucky to live twenty years after retirement. Today, lots of people are living right into their nineties and some even live past 100! This higher lifespan is due to better lifestyles and advances in medicine.

Today one needs to assume that they’re going to need a lot of money when they retire. In fact, retirement can be so long that the average retiree should assume that he or she will need to live off the income from the principal in their savings account and never resort to using any of the principal.

Most of us prefer to think that we’ll live a long and healthy life, but a long time takes extra planning. Use a free retirement calculator that you can find online to help you figure out how much money you’ll need to maintain a comfortable lifestyle for the remainder of your life.

There are ways to give yourself an idea of your own life expectancy. You don’t want to use the tables that are used by life insurance firms and financial advisors that work well when used for groups of people, although you can give yourself a general idea of the life expectancy of the group to which you would belong. Individual life expectancy cannot be calculated like the life expectancy of a group and using one of these tables can get you into hot water. This is because you may live a whole lot longer than the average life expectancy of someone your age. Nobody can make an accurate prediction as to how long they’ll live.

One thing that’s known is that life expectancy grew dramatically in the twentieth century. Early in the century life expectancy was about fifty years. By the end of the century it was about 80 years. Due to medical advances, it seems that life expectancy grows by leaps and bounds every year. That which was fatal last year may be survivable this year.

You can take a look at a life expectancy table and factor in your family history, your lifestyle, your personality type and whatever it is you do for a living, but you’re just making an educated guess. There are no absolutes when it comes to length of life.

Your Family History Can Give You Clues

It’s common and sensible to base how long you expect to live on how long your parents and grandparents lived. If your parents and grandparents all lived into their nineties, things are looking good for you to live into your nineties, too, right? If everyone died young, don’t make assumptions. You are probably living healthier than they did and will be able to take advantage of modern medical advances to boot.

Don’t ever underestimate your own life expectancy because doing this can cause you to seriously underestimate how much money you’re going to need to support yourself in retirement. You could easily run out of money right in the middle of your retirement.

Plan As If You Know That You Will Have a Long Retirement

Unless there’s some pressing reason for you to believe that you will live no more than 20 years post retirement, you need to assume that you’ll live 40 years and plan your retirement with that idea in mind. The very worst thing that could happen is that you’ll have lots of money at the end of your life to bequeath to your children. The best thing is that you’ll have plenty of money to live comfortably in retirement without ever worrying about it running out.

If you make the assumption that you’ll live 30 or 40 years after you retire it means that you’ll have to pledge that you won’t ever touch the principal of your savings. Forty years is a very long time to support yourself in retirement. You’ll have to live off the income from the money that you’ve saved. This concept is critical to a prosperous retirement.

A short retirement means that you can safely spend a little of the principal in your savings. But a long retirement of up to 40 years means that you will have to always take advantage of no more than the income of that principal.

You’ll also need to know the best ways to invest that principal so as to work around inflation and live the life you expect to live.

Pay Your House Off

A great way for retirees to insure that they’ll have enough money to retire is to pay off their mortgage while they’re still working. This will cut down on expenditures when you retire and it will also give you a very valuable asset.

You could budget your savings to make sure that they’ll last until a certain age, but should you live past that age, you can live on your biggest asset – your mortgage free home.

Enjoy Those Golden Years!

Having a longer life expectancy means you may live a long time to enjoy all the hard work that you did during your working years. The most important thing you can do is to make sure that you have enough savings to give you enough money to last your entire life. When formulating a retirement plan assume that you’ll live a good long time and enjoy every year of your well-deserved retirement!

About the Author:

Author Jason Munroe is extremely knowledgeable about one of his favorite subjects money! Living in Nevada with his wife and children, Jason loves to surf the Internet and considers travel to be a passion. When he’s not surfing or traveling, Jason enjoys teaching about wealth building and retirement issues.

Having A Backup Plan

If nothing else, the recent/current economic recession should be a warning to us all that our economic futures are likely not as secure as we’d like to think they are. Several people we’re thrust into no-win economic predicaments for a variety of different reasons. Simply put, the average person doesn’t anticipate ever losing their main source of income, yet it’s a potential reality that cannot be ignored. The key to planning for this is to have a backup source of income.

Many view alternative sources of income as a way to put some extra change in their pocket, but in a bind, these side-projects can end up being the difference between foreclosing and not foreclosing. Like anything worthwhile though, there aren’t any shortcuts to securing a quality alternative source of income. You will have to commit time and resources in developing a dependable alternative source of income. The key is to develop an alternative source of income based around something you enjoy doing. This will greatly increase the likelihood that you stick with developing it as a viable source of income and give it the attention it deserves. Below are just two ideas of ways in which you can develop an alternative source of income.

Detailing Rental Properties – I have a friend that contacted as many landlords as possible throughout his area a few years ago and offered to detail their rental properties for them prior to new tenants moving in. He usually charged around $500 per property (which was a flexible based on size) and now details, on average, two pieces of property a weekend. Not only does this provide a great source of extra income, but it also provides him with a solid backup plan.

He knows that if he ever lost his main source of income he could simply expand his apartment detailing business (which shouldn’t be too difficult given his accumulated experience) and live off that income. This obviously isn’t for everyone, but this man enjoys getting out of the office on the weekends and breaking a sweat. Once again, the key is finding something that fits into your lifestyle and preferences.

Build a Blog – All of us have a passion about something, whether it be golfing, social media, or Chinese dolls. No matter how obscure your passion is, it’s almost guaranteed that there are other people out there in the world that share your passion and want to learn more about it. A passion and a time commitment are really all that are needed to start up a successful blog. Blogs take a great deal of time to develop to the point that they bring in a solid source of income, so getting one started while you already have a stable source of income will allow you to develop it in the proper fashion. Creating a successful blog is also very much a learning process. The internet is packed with a wealth of information, link building services, and well established money making techniques (such as Google ad sense), that can guide you along the path towards making money with a blog.

This article was written by Anthony Benedict. Anthony helps to run and maintain – which is an Internet marketing company that provides white label SEO services.

3 Tips For Making Your Debt Reduction Plan Work In 2011

One of the most popular New Year’s resolutions is to set a goal for getting out of debt. Sadly, it’s also one of the hardest to achieve. Not because it takes any special training or techniques. But because it usually takes a person many years to get deep into debt – and it will take a lot of time to get out, too.

But there are some very simply ways to improve your chances of making it work in 2011. Most importantly, if you come up with an actual plan to make your resolution come true, you’ll be way ahead of most people. You won’t get out of debt just by hoping it will happen. Or just by working a little harder at it.

If you follow these 3 tips, you’ll be much more likely to be able to cross “getting out of debt” off your wish list for 2011:

1) Attack smallest debt first, so you “see” results.

There’s nothing less motivating than having a goal and not seeing any progress. That’s why it is so important to work on paying off your smallest debt first. Commonly known as the “debt snowball” method the idea is to pay off your smallest
debt first, then when that is paid off take the money you were using for that debt and add it to the next biggest debt. And your payoff will start to grow much like a snowball or bottom of a snowman. The motivation from paying off the first debt should keep you going, even when New Year’s Day is long gone and your resolution long forgotten.

2) Write down a series of goals you can actually reach.

If you’re struggling with money it’s easy to think “I don’t need to write down my goals, I know money is tight and my credit card bills are a constant reminder.” But that’s the negative way to look at it. The positive way is to write down your goals and put them in a place you can see on a regular basis. And when you reach a goal – no matter how small – cross it off so you can feel yourself being successful. So that’s why it is critical to break down your goal into small steps (such as making each of your monthly payments, or paying down your debts in $500 or $1,000 increments, anything that is meaningful to you). And make sure you write down each and every step. The more goals you cross off the list, the more likely you will be to reach the big one at the end!

3) You MUST find ways to spend less & earn more.

Take out your bank or credit card statements and look for as many expenses as you can to eliminate – eating out, buying stuff you don’t really need, buying stuff you really can’t afford, monthly subscriptions you can live without, lesser cell phone or cable TV plans – you get the idea. And look for ways to make extra money too – get a part-time job, sell stuff you don’t use, have a tag sale, start a simple home business like lawn cutting or house sitting or pet walking. Be creative!

If you follow these steps, your chances of making your debt reduction plan work are much better. But make sure to give yourself a “pep talk” every once in a while to keep yourself focused. Share your goal with a friend or family member who will support you during your tough times. An remember to reward yourself once in a while – not with a large screen TV or cruise – but maybe lunch out with a friend you don’t see that often, or an inexpensive piece of clothing to make yourself feel better.

So don’t forget to have some fun while you are working on your serious goals!

If you need more help with your credit card debt, check out You’ll find lots of strategies for getting out of debt and tips on various debt relief programs that can help you fix your financial problems.

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