How long can I live before running out of money? This is the question we get most often from our clients. According to a Bloomberg article from earlier this year, people fear running out of money in their final years more than they fear dying! Having a magic "$1 Million" retirement goal is oversimplifying the process. Retirement math is harder now than it was a few decades ago for a variety reasons summarized in the $1 Million Retirement Myth article:
- The shift from defined-benefit pensions to defined-contribution plans puts it on individuals to calculate how much they’ll need
- It’s become increasingly difficult to determine future costs due to inflation and economic uncertainty
- Many people have doubts about whether they can count on government benefits
- People are living longer, so they’ll need more money both to pay bills and health costs and to enjoy themselves
These are some of the challenges we discuss with our clients when we conduct their personalFinancial Success Stress Test. Whether you are nearing retirement or still a decade or more away, the software program we use to evaluate your probability of running out of money allows us to look at your life expectancy, risk level, income sources, needs and wants, retirement plans, economic uncertainty, etc.
We don't want our clients to be worried about running out of money so this is one way that we can help facilitate more peace of mind.
To dive deeper into this topic and read the entire article summarized above,click here.
To understand more about our Financial Success Stress Test process,click here.
As always, give us a call if you'd like to discuss any of this in more detail as it relates to your personal and unique situation.