Those Retirement Years

For those of you, considering retirement soon, BEWARE. The Employee Benefit Research Institute (EBRI) has just come out with some dramatic information for soon-to-be-retirees. It seems that baby boomers are at a high risk of not having enough money to sustain them through their retirement years and that financial security may be lost earlier than expected. In other words, boomers are likely to exhaust their savings after 10-20 years of retirement. Those boomers who are now between the ages of 56-62 have a 47% chance of not being able to pay for basic retirement needs plus medical costs. Younger boomers who are now 46-55, have a 43% chance of being in danger. Apparently, most people don't want to think about this. The research indicates that even with concern about health care costs, about 50% of workers don't bother calculating what they would need to live comfortably in their "senior" years.

There is some hope, however. Boomers still have a chance to modify their current situation, but there is no guarantee that things will be reversed in time. However, here are some of the obvious things you can do now: 1. Stay at work longer. Delay when you retire to 70 years old so you can increase your financial assets and your Social Security benefit.

2. Invest more money in your 401K plan now while you are still working. This forced savings will essentially help to increase your net worth. 3. Slow down your current rate of spending by cutting back on luxuries and other excesses. Remember that the results of this survey are based on life expectancy, investments and health care spending during retirement. Since life expectancy has increased over the past century, people can expect to live 20-30 years past their retirement. Therefore, craft a solid financial plan for the years to come, which will secure your retirement is the happy, carefree time it should be.

About the author: Amy Sherman, LMHC is the author of Distress-Free Aging: A Boomer's Guide to Creating a Fulfilled and Purposeful Life.

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