5 New Challenges to Retirement


Filed under: Retirement


Senior fisherman rowing in a boat on a lake Mikkeljavre in NorwaDo you remember when your parents or older friends retired? They probably made it look easy, or at least not overly difficult. Hopefully it will go that way for you, too… But because retirees face a very different reality today, we wanted to remind you of the challenges most will face in the near future.

Debt. Americans now carry over one trillion dollars in revolving debt, as compared to 1.3 billion dollars in 1968. Sure, inflation is a part of that, but larger mortgages and massive student loans are hurting most of us these days.

A longer lifespan. In 1960, the average life expectancy in the US was 69.77 years old. In 2015, that prediction had increased to 78.74 years. In fact, if you’re 65 years old today, you have a one in four chance of living past age ninety! That means some of us will spend thirty or more years in retirement. It also means thirty or more years living off of our retirement incomes!

The cost of healthcare. According to an analysis by Fidelity Investments, a 65-year-old couple who retired in 2016 needed to budget $260,000 to cover the cost of healthcare over the course of their retirement years (yes, that’s with Medicare coverage). In 2017 that figure grew to $275,000! It’s easy to see that the cost of healthcare is rising rapidly from one year to the next… and Medicare won’t cover everything you need.

Long-term care is expensive. Speaking of uncovered medical services, did you know that Medicare covers very little of the cost of nursing care? Most of it will be your responsibility, and the price tag is hefty. An assisted living facility costs, on average, $45,000 per year, while the average cost of a private room in a traditional nursing home is $97,455. About half of current retirees will need long-term nursing care at some point in their lives, according to the US Department of Human Services.

No more pensions. In 1998, 59 percent of Fortune 500 companies offered pension plans to their retired employees. Now, that number has fallen to just 20 percent. Most of us can’t depend on a pension anymore, so we have to take full responsibility for funding our own retirements.

We’re not telling you all of these things to scare you, and it’s certainly still possible to save for a successful retirement. But the point is that you must assume that things like healthcare and nursing care will impact your budget, and factor those things into your long-term financial plans. And of course, we hope that you can retire without hefty debts, and with a stable form of retirement income.

On that note, give us a call. We can help you identify ways to generate the income you will need in retirement, and begin planning for the future now.



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This information has been provided by a licensed insurance professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting the insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax, trust and estate, or investment advice. Infinite Wealth Advisors is not an investment advisory firm.  Investment Advisory Services provided by NAMCOA® – Naples Asset Management Company®, LLC, a federally registered investment advisor, website: www.NAMCOA.com .