Tuesday, May 1, 2012

3 Tricks to Make Your Retirement Last to Your 100th Year ...

by Cynthia S. Ellner on April 30, 2012

Living to your 100th birthday may sound attractive, but will your retirement funds last that long? It?s not unusual to reach the 100-year mark, and if you do you?ll need about a 40-year fund to ensure a sound financial future, especially with the high cost of living in Southern California. One long-term illness could significantly reduce your retirement plan, so it?s better to overshoot the mark by a few years. When developing your long-term plan, consider the following:

  • List all sources of income. Do you have part-time income? Residual income? Include the amount you receive from Social Security, the minimum withdrawals from other investment accounts, pensions and annuities. Look at your yearly retirement expenses and allow for inflation of all costs over time.
  • Cut, cut, cut. If you?ve scaled back your work or stopped working altogether, cut your expenses. Any work-related costs, such as higher car insurance, suits or uniforms for your job, expensive dinners to entertain clients are all unnecessary retirement expenses now. Don?t keep spending as if you were still working.
  • Consider scaling back your residence. If you?ve lived in a big sprawling house with big sprawling bills, can you downsize and bank the profit? Keeping the family home is wonderfully sentimental, but if grown children aren?t making use of the space, hanging onto something for sentimentality instead of investing a profit makes little sense. A home is not a liquid asset that can be used in case of a retirement emergency, and lenders may not be willing to give seniors a home equity loan without visible means of paying it back.

California Pensions, incorporated since 1968, designs and administers retirement plans for professionals. Call 310-400-5571 or email csellner@pacpensions.com today to set up your appointment.

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