I've been tracking the strategies being recommended to boomers regarding their retirement monies and the #1 choice is work longer. Specifically, add 2 to 3 years to your career in order to increase savings and, especially important in the current economic conditions, to delay drawing from your 401K. If your intended retirement year happens to fall in bad times, previous projections of your retirement income may not hold up. It's a sequence risk, referring to the sequence of ups and downs in the market that can wreck your plans if you have to go through a catch-up phase at the wrong time. (And any time close to the retirement year is the wrong time.)
Further study took me to an executive summary on Social Security published by the Brookings Institution. Interestingly, the expert there also pointed to the work longer strategy, and he's talking about people who will retire decades from now. Specifically, the policy brief summary identifies mid-60s as the target age for requirement for the next generation. The brief also outlines the likeliest changes America will need to make in Social Security and retirement savings in the coming years. A reform package is possible with compromises by both conservatives and liberals. And a smart reform package will take a few lessons from other aging populations around the globe.
© 2008 Mary Bold, PhD, CFLE. The content of this blog or related web sites created by Mary Bold (www.marybold.com, www.boldproductions.com, College Intern Blog) is not under any circumstances to be regarded as professional, legal, financial, or medical advice. Or education advice. Or marital advice. Or even a tip.
Posts
No comments:
Post a Comment