Jeff Schlegel wrote an interesting article in the August 2011 Financial Advisor magazine entitled "What is a Retirement Crisis?" and mentioned that, regardless of income, pre-retirees need to consider the lifestyle changes that may be needed.
The retirement crisis is often presented as households not saving enough but, more than that, is the author's "crisis of expectations". He succinctly states "...lots of people...will be disappointed when they...understand what they can actually afford to spend out of their accumulated portfolio...."
Here is an example that I would like to provide: if you have saved $150,000 then that may generate $500 per month in retirement but even that will depend on your life expectancy, how you allocate those funds and a variety of other factors. That may be sufficient for some if you have a nice pension and you have a modest lifestyle but there still may be a crisis of expectations.
If you have saved $1,200,000 then you may be able to "squeeze" out $4,000 per month. That, however, may not even be close to your current lifestyle spending needs resulting in another type of crisis of expectations.
An Introduction
Hi. Welcome to BourGroup and my blog. Phil
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.