People are living much longer these days. With modern medicine, technology, and taking better care of ourselves, reaching 100 is much more common than it used to be. According to a Wall Street Journal article from April 14, 2008, Hallmark sold over 85,000 “Happy 100th Birthday”
cards in 2007. And that is just Hallmark. Currently the average life expectancy for a Female is 87 years, and 85 years for a Male.
Living that long is great, but it can also raise concerns about your savings. What are you doing to make sure your money lasts that long also? Can your savings generate income for the rest of your life, even if you live to 100 or beyond?
Also, how prepared are you to keep up with rising costs? Did you know that 20 years ago (1989), the cost of a postage stamp was 0.25 and a gallon of gas was about 0.97? Compare those prices with today. A stamp is 0.44 and a gallon of gas…..well it fluctuates more than the stock market. As of today, it is about 2.45, and last summer had peaked well over 4.00.
If you are retired for 20 years or more, costs will go up. How can your savings handle that? Can you give yourself “Pay Raises” and still make it last?
One last question for consideration - this past year was one of the most challenging ever for investors. How can you grow your income, make your money last, and do it “Safely”?
Here are some tips that may help answer these burning questions.
* Talk with your advisor. And if you don’t have a strong relationship with your advisor, or
you don’t feel they have your best interests in mind, find a new one. Your advisor needs to be a
great listener, and your partner - NOT just a stockbroker. Tell them what your needs are.
What is most important to you about your money?
* Be Open Minded. If your money is going to last for your lifetime, CDs aren’t going to get it
done. Especially at the current bank rates today. There are other ways you can invest, and
let your money grow over time safely. A good advisor should learn as much about you as
they are able - just like a doctor who will learn your history before prescribing anything.
“Whatever you fear most has no power - it is your fear that has the power.”
* Be Diversified. I’ve always thought of “diversification” like clothes in your closet.
You need to have clothing for summer, winter, fall, casual wear, dressing up,
working in the yard…..ALL occasions and ALL types of weather. Investing needs to be
the same. Would you like less risk? The best way to do that is by diversifying.
“Money, you should pardon the expression, is a little bit like manure. It doesn’t
do any good unless it’s spread around, encouraging young things to grow.”
For more information on how to make your money last to 100 or beyond, please contact me at
www.helpmy401k.us. You may also follow me on Twitter at www.twitter.com/deanvoelker.