Today’s retirement may look nothing like your parents’ or grandparents’. People live longer, benefits grow thinner, and health-care costs rise. Review your financial situation and start planning early so that this new retirement doesn’t catch you unprepared.
The new environment you retire in is a very mixed bag – there’s good news, bad news and unpredictable elements. You can live longer than ever, and stay active into your 70s, 80s and beyond. But to support a longer life, you may end up working long past 65, even if you are reluctant to. Your aging parents live longer and may need your help. Your adult children may need financial support, too.
All these challenges require more planning than ever. It’s never too early to begin thinking and planning for the new retirement. Times have changed:
1. You may work past 65. The average retirement age was 57 in the 1990s. Now it’s 62 and likely to continue to rise. It’s great to keep working if you love your job, but you may have to delay retirement or work part-time because of insufficient savings – even if you hate what you do and you can’t wait to retire.
2. You have a longer retirement to finance. A man reaching 65 today can expect to live until 84, and a woman 86, the Social Security Administration says. And those are just averages. You may have 30 years of retirement.