It may be startling to think about, but with many retirements lasting 20 to 30 years or longer, you could actually spend a third or more of your life in retirement.
Though your annual income may be fixed at retirement, your living costs can be expected to increase because of inflation. For example, at an assumed rate of only 4% per year, inflation will double your living costs in less than 18 years. At that rate, a product costing $100 at age 65 would cost $219 at age 85.
Effective planning may enable you to enjoy the freedom of your retirement years. Without it, it may take everything you have just to get by. Here are five questions you should ask yourself as you plan for retirement:
- What investment choices should I make to live comfortably in retirement?
- How does my age affect my taxes and what should I do to save on taxes?
- How can I prevent a major illness from destroying my financial resources?
- Is my present life insurance right for my later years?
- What should I do to make things easier for my family in the event of my death or a disabling illness?
Stay tuned in the coming weeks as we take an in-depth look at each of these questions. In the meantime, contact your financial advisor to get answers to these questions and more regarding your financial plan.
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This information is provided for informational and educational purposes only.
The information provided may include references to concepts that have legal, accounting and tax implications. It is not to be construed as legal, accounting or tax advice, and is provided as general information to assist in the understanding the issues discussed. Neither Waddell & Reed, Inc., nor its financial advisors associated with Waddell & Reed give tax, legal, or accounting advice. You may want to consult with your accountant or tax advisor to discuss your personal situation.
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