How to Avoid the Top 3 Financial Fears in Retirement

You’ve worked hard for your money and during your retirement years, you want to have confidence that you can enjoy it. However, many retirees have common concerns as they move from asset accumulation to asset preservation. “Am I spending too much?” “Have I set aside enough for long-term care?” “Will I outlive my assets?” These are all questions many retirees think about. But they aren’t matters you have to address alone. Together, with your financial advisor, you can get the answers to these questions and overcome some of the most common financial fears when it comes to retirement.

1. Running out of money during retirement. Retirees are plagued with the fear that they will outlive their money during retirement. In fact, they are more concerned with this matter even more than death. It’s no wonder more than half of American workers list this as their number one worry¹ – with increased health care costs, longevity, inflation, etc., it’s a valid concern, especially when you factor in the statistic that for nearly one third of Americans, this could be a reality.² What can you do to prevent this from happening? It starts with following a personalized financial plan that incorporates your retirement goals. Your financial plan should include a spending strategy, Social Security, long-term care insurance and tax planning.
2. Losing your income stream. Leaving the workforce and no longer receiving a regular paycheck is scary. And with the uncertainty of Social Security, those nearing retirement are concerned with quickly depleting their savings. According to the Social Security Administration, over half of those in retirement rely on Social Security for at least half of their income during retirement.³ But did you know your financial plan may be designed for income generation during your retirement years? Retirement income planning is a major component for many retirees so in addition to incorporating this into your plan, your financial advisor can also help you optimize your Social Security strategy so you are maximizing the income you receive.
3. Being forced into early retirement. From health issues to job loss to caring for a loved one, more and more Americans are leaving the workforce involuntarily. When one must retire sooner than expected, it’s important to draw upon your money in the most tax efficient manner to help prevent outliving your assets. By seeking the help of a financial professional, many options can be explored and your financial plan can be adjusted so you have clarity on your future.

In reviewing these top three financial fears during retirement, the underlying theme is the fear of the unknown. The purpose of a good financial plan is to prepare for the unknown. We believe that money doesn’t have to be complicated or scary. You worked hard for your money, now it’s time to enjoy it. Let us build a retirement income plan for you! Schedule a personalized listening session with an advisor to discuss your fears and get a plan in place to overcome your worries.

¹ TransAmerica Retirement Survey December 2016 https://www.transamericacenter.org/docs/default-source/retirement-survey-of-workers/tcrs2016_sr_retirement_survey_of_workers_compendium.pdf

²AP-NORC Center for Public Affairs Research 2016 Long Term Care Poll https://www.longtermcarepoll.org/PDFs/LTC%202016/AP-NORC%20Long%20Term%20Care_2016.pdf

³Social Security Administration, 2017 https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf