Retirement Income Planning
Retirement Risks
The five key risks of retirement are longevity, health care expenses, inflation, asset allocation, and excess withdrawal.
Medical Expenses
Fidelity estimates that the average 65 year old will need $295,000 to cover their medical expenses. This amount is comprised of 19% for prescription drug out-of-pocket costs, 39% for Medicare premiums, and 42% for copayments, coinsurance, etc.
Inflation
With 2% inflation, $50,000 today will have the purchasing power of $30,477.
With 4% inflation, $50,000 today will have the purchasing power of $18,756.
Retirement Income Planning
There are four main steps to the retirement income planning process. They include taking an inventory of expenses vs. income, covering essential expenses, funding discretionary expenses, and reviewing the plan regularly.
Click on the link below to read more on how you can prepare for retirement!
