Lifestyle retirement planning

Lifestyle is a chosen way of living. In the retirement years though, lifestyle becomes less of a choice and more of a default position.

What does that mean? Your financial resources, your investments and your expenses will largely determine what kind of a lifestyle you’ll have in those after-retirement years.  The U.S. Office on Aging says the median income for women over age 65 was $15,072 in 2010. Unfortunately, that doesn’t offer a very secure lifestyle.

woman making plansSo what happens when the savings you have are not as big as you might like? That’s the issue I’ve been researching on behalf of millions of “baby boomer” women. (There are 38 million of us born between 1946 and 1964, according to census data.) If you’re not in that age group, you may have a mother who is, so keep reading, as this affects your extended family.

If “boomers” are to keep a decent standard of living, they are going to have to think creatively. Most boomers start retirement with less than $100,000 of savings. Using the standard recommendation of 4% per year withdrawal, even $100,000 will only generate about $4,000 per year the first year of retirement, and can be indexed up slightly to account for inflation in later years.

$4000 a year works out to $333 per month. This doesn’t go very far, especially when added to the average Social Security check of $1230 for 2012.

$1230 average SS

+ $333 (4% monthly income on $100,000 of investments)

$1563 per month or $18,756 per year

Living on less than $20,000 per year means there’s a need to lower housing costs and do everything possible to have enough to pay for basic living expenses. If you have saved more than $100,000, just multiply it by 4% to get a safe withdrawal per year amount.

Lifestyle retirement planning is a way to find creative ways to lower housing costs, tap into home equity in a responsible way if needed, maximize investment income, and find solutions to generate enough income to last a lifetime.

It’s a recipe for finding that “true-to-you” lifestyle that fits your needs.

There are lots of pieces to this retirement income puzzle. It can be a challenge to find the best solutions on your own.

Here’s a start. Look at the 3 “C”s of the new retirement planning—the blueprint for our retirement coaching.

Clarity

This is the process of identifying all the assets that could help you generate retirement income. (You might be surprised to find ones you’ve overlooked.) It’s also where you look at your desired lifestyle to see how that fits in with your future retirement income.

Creativity

Here’s where you discover new ways to save money and increase your income. Reducing investing costs is one of the “low hanging fruit” strategies we promote. You can also look at housing solutions that fit your budget and lifestyle. Look for ways to increase Social Security checks before you start taking them. You might benefit from retirement income sources such as fixed and hybrid annuities that can provide guaranteed and stable income for life.

Cash-flow

Planning ahead and getting expert guidance give you 2 important benefits:

1)    Increased cash flow/ income

2)    The ability to spend with confidence, knowing you have set up a “true to you” lifestyle

Whether you do-it-yourself, or get some help, pay special attention to this type of retirement planning. It can mean the difference between having 20 to 30 years of struggling with money or the confidence that comes from knowing you’ve got your income arranged.

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We are not offering Retirement Lifestyle Planning at this time.

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