The number one fear in retirement is - you guessed it! - running out of money. You have relied on your personal income your entire adult career… but you also had the ability to control it, stabilize it, and even change it. You held the power. You determined what you were worth. Yet when you retire, everything changes. You are no longer working and no longer hold those keys.
Let’s take a walk down memory lane: Not so long ago, we talked about a “three-legged” stool in retirement. It was made up of Social Security, pension, and savings… and would be what supplied your income.
Fast forward fifteen years and a lot has changed. There are few retirees who benefit from a three-legged stool. Most have a two-legged stool at best. Some are even balanced on one leg with maybe a stub.
The bottom line: more of your future is dependent upon you setting yourself up for success now than ever before.
How about another walk down memory lane? Do you remember the commercials from ING in 2010 where everyone was walking around with an orange block on their head displaying a number and the tag line What’s your number?
This oversimplification makes a very good point. You need to know your number. How do you know if you have enough if you don’t know what is enough?
I wish it was as simple as a retirement calculator on Google, Fidelity, or otherwise. Maybe then you wouldn’t have that uneasy feeling you just had when that question was posed. The truth is it isn’t simple.
You can plan for the income you need, but a calculator cannot plan life. What if you die too soon? What if you live too long? What if you get sick too early? What if any of that happens to your spouse? What about children? What if something goes wrong? And not to mention the outside forces of which you have no control—the markets, economy, government, cost of living….
Can a calculator navigate these dangers? If yours hasn’t, you don’t have your number.
There is a world of complexity surrounding you. Moreover, you will be balancing on a one or two-legged stool. Knowing your number is everything.
I recently sat down with a couple and asked them, What keeps you awake at night? The answer was money. I asked…what about money? You guessed it…they were worried about running out of money in retirement.
Sadly, this couple has spent the better part of a decade worried. I just wonder if this would have been the case if we had sat down with them a decade ago.
Don’t get me wrong - we are not miracle workers. However, we are that type of professional that is going to tell you the truth, even if it hurts - and for one reason only. We want you to retire and we want you to stay successfully retired!
So, what are you waiting for? If you don’t know, don’t wait. Time is money after all.