Retirement is changing. Make sure you stay ahead of the curve and enjoy a long, happy retirement.

1. In 1940 Today
There is a new factor affecting those nearing retirement age: we are living longer!
Americans can still dream of their golden years, they’ll just need to make some changes
to be prepared for the “New Retirement.”
That means it’s important to have a solid plan for funding your retirement years.
In fact, the sooner you start closing your retirement funding gap, the better.
A good rule of thumb is to put 10% of your earnings into a retirement savings
fund (401(k) and/or IRA).
Most people will need about 80% to 85% of their preretirement earned income
to fund retirement expenses.
A 65-year-old
man typically
lived to 77.7
years old
A 65-year-old
woman typically
lived to 79.7
years old
The average
65-year-old man
today can expect
to live until age
84.3
The average
65-year-old
woman today
can expect to
live until age
86.6
65-year-olds today
will live past 901/4
THE NEW RETIREMENT
WE ARE LIVING LONGER
If you don’t think you have enough for 20 or 30 years, it may be necessary to step up your
savings or consider postponing your Social Security payments so you receive a higher
monthly amount later on.
IT’S NEVER TOO SOON TO START SAVING
It’s best to think through how you want to live in retirement and develop a budget.
Once you’ve estimated all of your expenses, add some for unexpected needs
and contingencies.
Remember, it’s not wise to count on luck or an unforeseen windfall to carry you
through retirement.
The most significant expenses for retirees include:
Other expenses to consider are generally more discretionary:
These four
categories can
consume about
housing
transportation
travel apparel education charityentertainment
food & beverage
health care
BE REALISTIC
To accumulate
assuming an average annual investment return of 7%
For example:
27 years old
needs to invest
37 years old
needs to invest
47 years old
needs to invest
57 years old
needs to invest
$5,000
$10,600
$24,400
$72,400
$1,000,000 67by age
per year
per year
per year
per year
80%of after-tax
retirement income
For resources on saving for retirement and making funds last, visit www.picpa.org/moneyandlife.
Source - Social Security Administration
8444/15