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Could Assumptions Harm Your Retirement Strategy?

Three common misconceptions to think about.

Provided by: Nate Lewis

1 – Assuming retirement will last 10-15 years.

When Social Security was created in the 1930s, the average American could anticipate living to age 58 as a man or 62 as a woman. By 2017, life expectancy for the average American had increased to 78.6. That said, this average may bely the fact that many retirees could live well into their nineties or beyond.1,2

Assuming you will only need 10- or 15-years’ worth of retirement money could be a big mistake.

2 – Assuming too little risk.

Holding onto your retirement money is certainly important, but so is your retirement income and quality of life. While overall inflation has been below 3% for most of the past 10 years, your personal inflation rate may be higher. In that situation, your dollar gradually buys less and less. If your income doesn’t keep up with inflation – essentially, you end up living on yesterday’s money.

For this reason, a flexible retirement strategy will likely factor in many situations and scenarios; you cannot plan for every single scenario, but considering many possibilities may give you and your financial professional numerous options down the road.

3 – Assuming you will be in excellent health. While it’s true that we lead healthier lives than our ancestors and that medical science and awareness of fitness and nutrition have improved and extended many American lives, that improvement doesn’t cover every issue that comes with advanced age. Extended-care issues can sap away retirement funds.3

Recent findings by the U.S. Department of Health and Human Services offer some perspective: over a quarter of all people who have turned 65 between 2015-2019 are probably going to need $100,000 of extended care, while 15% of that same group is looking at $250,000.3

For these reasons, a retirement strategy should include some thinking about paying for extended care of this sort. Yes, Medicare can help you with the basics, but an insurance strategy that can accommodate longer hospital stays and care should also be a part of your thinking.3

Remember that good strategies also change over time, and you will probably want some help along the way. Make time to discuss these common assumptions, and how to avoid them, with your retirement professional.

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This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Citations.

1 – ssa.gov/history/lifeexpect.html [2/19/19]
2 – pbs.org/newshour/health/american-life-expectancy-has-dropped-again-heres-why  [11/29/18]
3 – kiplinger.com/article/insurance/T036-C000-S002-how-to-afford-long-term-care.html [1/31/19]

©2019 Lewis Wealth Management Group
(217) 337-5584
2506 Galen Drive Ste 104
Champaign IL 61821 
IMPORTANT DISCLOSURES: Investment advice is offered through Belpointe Asset Management, LLC, 125 Greenwich Avenue, Greenwich, CT 06830 (“Belpointe”). Belpointe is an investment adviser registered with the Securities and Exchange Commission (“SEC”). Registration with the SEC should not be construed to imply that the SEC has approved or endorsed qualifications or the services Belpointe Asset Management offers, or that or its personnel possess a particular level of skill, expertise or training. The information provided is educational in nature and not designed to be a recommendation for any specific investment product, strategy, plan feature or other purposes. This is not suggesting a specific course of action or any action at all. Communications such as this are not impartial and are provided in connection with advertising and marketing. Prior to making any investment or financial decisions, an investor should seek individualized advice from a personal financial, legal, tax and other professional advisors that take into account all of the particular facts and circumstances of an investor’s own situation. Insurance products are offered through Belpointe Insurance, LLC. Lewis Wealth Management Group is not an affiliate of Belpointe Asset Management, LLC. Important disclosures related to Belpointe are available at http://www.belpointe.com. Additional information pertaining to Belpointe’s registration status, its business operations, services and fees and its current written disclosure statement is available on the SEC’s Investment Adviser public website at https://www.adviserinfo.sec.gov/.  

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