What Women Shouldn't Retire Without

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   “For I know the plans I have for you, declares the LORD, plans for welfare and not for evil, to give you a future and a hope.”   Jeremiah 29:11.

   When our parents retired, living to 75 amounted to a nice long life and Social Security that was often supplemented by a pension.  How different things are today! 

   The good news is that life expectancy for women – as measured by the Centers for Disease Control – is now 81.1 years. The Social Security Administration estimates that the average 65-year-old woman today will live to age 86.   1,2

   Are you prepared for a 20-year retirement? How about a 30- or 40-year retirement? This could be your reality: the SSA projects that about 25% of today’s 65-year-olds will live past 90, with approximately 10% living to be older than 95.2

   How do you begin? How do you draw retirement income off of what you’ve saved, and how can you create other possible income streams? How do you try and protect your retirement savings and other financial assets?

   “Before you spend, earn. Before you invest, investigate … Before you retire, save.  Before you die, give.”   (William A. Ward).

   Talking with a financial professional may provide some good ideas. Consider an advisor who walks your walk, and who understands the particular challenges that many women face in saving for retirement (time out of the workforce due to childcare or eldercare, maintaining financial equilibrium in the wake of divorce or death of a spouse).

   As you have that conversation, focus on some of the must-haves.

   Plan your investing. Many women (and men) retire with a random collection of investments, and no real strategy. Some are big on “chasing the return” – assuming risk they really shouldn’t in pursuit of a double-digit yield. Others are very risk-averse, so fearful of what stocks might do that they stay out of the market entirely – and in the current low interest rate environment, that represents an easy way to fall behind and lose purchasing power to inflation.

   Find a middle ground. When in your fifties, for example, you have less time to make back any big investment losses than you once did. So protecting what you have is a priority. At the same time, the possibility of a 15-, 20-, or even 30- or 40-year retirement means you’ll need to keep a foot, if not both feet, in some kind of growth investing. Your initial retirement nest egg must keep growing.

   Consider long term care coverage. It is an extreme generalization to say that men die sudden deaths and women die lingering ones; however, women often have longer average life expectancies than men and can require weeks, months, and even years of eldercare. Medicare is no substitute for LTC insurance; it pays merely for 100 days of nursing home care, and only if you receive skilled care and enter a nursing home immediately after a hospital stay of 3 or more days. Long term care coverage can provide a huge financial relief if the need for LTC should arise.   3

   Claim your Social Security benefits carefully. If your career and health permit, delaying Social Security is a wise move for single women. Postponing your benefits until full retirement age can result in receiving 30-40% larger Social Security payments. For every year you wait to claim Social Security, your monthly payments become about 8% larger.   4

   Above all, retire with a plan. Have a financial professional who sees retirement through your eyes and can help to define it on your terms, to include a wealth management approach designed for the long term.

   “Don’t set hopes on the uncertainty of riches, but on God, who richly provides us with everything to enjoy. Do good, be rich in good works, generous and ready to share, storing up treasure as a good foundation for the future, so that [you] may take hold of that which is truly life.”   1 Timothy 6:17-19.
   
Submitted by Patrick Wallschlaeger, CEO, Midwest Professional Planners, Ltd., a Registered Investment Advisor.  You can write to him at 2610 Stewart Ave. Suite 100 Wausau, WI 54401, or call him at 1-800-236-6775.  
Investment Advisory Services offered through Midwest Professional Planners, Ltd. (“MPPL”), 2610 Stewart Ave., Ste. 100, Wausau, WI 54401, 1-800-236-6775, an SEC-registered investment advisor. Securities products involving commission or transaction based fees are offered through Comprehensive Asset Management and Servicing, Inc. (“CAMAS”), 2001 Hwy 46, Ste. 506, Parsippany, NJ 07054, 1-800-637-3211. Member FINRA/SIPC/MSRB. MPPL is independent of CAMAS.  
    
Citations.
1 - cdc.gov/nchs/data/nvsr/nvsr61/nvsr61_06.pdf [10/10/12]
2 - ssa.gov/planners/lifeexpectancy.htm [10/10/13]
3 - medicare.gov/coverage/skilled-nursing-facility-care.html [10/14/13]
4 - money.usnews.com/money/retirement/articles/2012/04/02/what-older-workers-dont-know-about-social-security [4/2/12]

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