As we begin the year, it is traditional to think about the future. Today my good friend, Dr. Gary North, helps us to think far into the future, about our plans for retirement. This is one you should forward to friends and family who have yet to begun thinking about how they will live out the last part of their lives.
This note from the December issue of Retirement Plan Advisor literally crossed my desk as I was getting this issue of Outside the Box ready.
"Data from a new study of the recently retired prepared for Putnam Investment underscores the need for employees to invest more aggressively before retirement, as Social Security, traditional defined benefit and cash balance plans remain the largest source of income for households. This is true despite the fact Social Security is in jeopardy, DB plans are on the wane, and cash balance plans face uncertainty because of litigation.
"The biggest surprise for recent retirees, the study states, is having insufficient income and high expenses. Fifty-nine percent of the nearly 2,000 respondents wished they had started saving earlier, while 70% regretted not saving more through their employee-sponsored retirement plan or via an independent plan."
Gary sees most people unprepared for retirement, but if they take a look at what the future might hold there is time to adjust. Let's take a look at some of the scary statistics and possible solutions.
John Mauldin, Editor
Outside the Box
SAVING FOR A RAINY QUARTER CENTURY
"People can expect to live one-fourth or one-third of their life in retirement," says Jeffrey Brown, an economist and author of a recent study released by Americans for Secure Retirement. "That requires a lot of planning." The challenge, he explains, is to make a nest egg last a lifetime in the face of uncertainty about how long one…