The number of Americans living to see their 100th birthday is on the rise. It is not easy to pay for that many years of retirement.
According to the Center for Disease Control and Prevention, the number of Americans who lived to be 100 years old increased by 44% between 2000 and 2014. Nevertheless, the total number of living centenarians was still a relatively low 72,197.
If people retire in their 60s and live to be 100, that is a lot of retirement years for planning.
Recently, U.S. News & World Report offered some tips for planning for such a long retirement in "How to Finance Living Until 100."
The advice includes:
- Delay Social Security Benefits – Every year you delay taking Social Security past full retirement age increases your monthly benefits by 8 percent.
- Be Wary of Inflation – Invest in assets that are either guaranteed to keep up with inflation or have historically done so.
- Get A Pension – If you have a job that offers a pension, then you will have more money to spend during retirement.
- Get an Immediate Annuity – While they are not right for everyone, getting an immediate annuity will allow you to receive regular payments no matter how long you live.
- Draw Down Slowly – When you do retire, be as conservative as possible in drawing down your retirement savings.
It is still unlikely that any particular person will live to be 100. However, it is always good to plan for the contingency that you might be one of the lucky few.
If it turns out that you do not live that long, the assets will not be wasted as long as you get an estate plan that appropriately passes the assets on to younger family members.
Please contact my office for assistance with your estate plan, or if you would like help in choosing a financial planner to add to your team.
Reference: U.S. News & World Report (Jan. 22, 2016) "How to Finance Living Until 100."