Hidden Retirement Risks! Pt.2 Longevity Risk
Hello! And welcome to this week’s episode of the Christian Retirement Show. Today we are continuing our series on the hidden Retirement Killers lurking just under the surface for people who are retired or are preparing for retirement and how to beat them! This week we’re talking about the biggest fear I hear from retirement savers which is longevity risk!
On today’s show we cover what longevity risk is, it’s causes, and how to overcome longevity risk so you can have a successful retirement!
Over-spending- If your lifestyle over reaches your resources you are going to have a rough time in retirement. You may start depleting your savings & investments quickly or it may be a slow burn, but one way or another spending too much will be disastrous for your retirement plans.
Investment performance- Most retirees rely on investments to fund their retirement goals. In simple terms- inflation and the cost of living just can’t usually be funded using savings in a checking account. If investment returns during your retirement do not reach certain benchmarks- whether from poor investment decisions or poor overall market performance. This can seriously jeopardize your retirement success and be a significant challenge to overcome.
Living longer than expected- As we discuss modern medical advancements and knowledge on how to take care of our bodies has led to quickly increasing life expectancies and higher quality of life. This means that you not only have a greater chance of living longer but also have living a high-quality lifestyle as well. Now while this is great news and the alternative is not great, this can be a cause of serious concern and anxiety when retirees must face the reality of funding a retirement that is much longer than they ever thought possible.
Budget realistic expectations of retirement spending prior to your retirement date- What this allows you to do is head into retirement with your eyes wide open as to how much you need to live your desired lifestyle and if the resources at your disposable can fund that lifestyle. A great way to do this is by looking at your current level of spending and using that is a gauge for how much you will likely spend once retired.
Have a quality investment plan in place- that is built to withstand ups and downs in the market. This means being well diversified and not taking more risk than you are a) comfortable taking and b) should take in order to not jeopardize your retirement savings.
Build a retirement plan- What a retirement plan allows you to do is take all of your lifestyle needs- daily spending, travel, big expenses; all of your resources including retirement savings, pensions, annuities, & social security. And then run calculations to ensure your desired lifestyle can be funded by your resources.
Resources in Show:
Christian Retirement Planner Website- https://www.christianretirementplanner.com/
Free Retirement Assessment- https://www.christianretirementplanner.com/your-free-retirement-assessment
Weekly Money Bible Verse- https://www.biblegateway.com/passage/?search=Malachi%203%3A10&version=NIV
Listen on Apple- https://podcasts.apple.com/us/podcast/the-christian-retirement-show/id1530097100
Listen on Spotify- https://open.spotify.com/show/2CvP6jKwvQM9UHCVNbAmVI?si=jFZ1beE2TkeguYK5sF6E0A