Are you over the age of 50 and facing a divorce? According to new research, you’re not alone. The Pew Research Center recently found that divorce rates for people age 50 and older have doubled since 1990. Divorce rates among those over age 65 have tripled during that same period.1
There are a number of reasons why divorce rates are rising for those over age 50. Some couples may wait until their children are out of the house to separate. Some couples may have sharply different views on how they want to spend retirement.
It won’t happen to me. If that’s your thinking with regard to disability, you may want to reconsider. According to the Council for Disability Awareness, American workers on average think they have only a 2 percent chance of suffering a disability during their career. The truth is that the average worker has a 25 percent chance of missing work because of disability.1
Disability can be caused by many different health challenges. You could be involved in a serious accident. You might suffer an illness, like cancer or heart disease, that forces you to take time away from work. You may have chronic pain that increases in severity as you get older.
A lot of things in retirement are beyond your control. You can’t control what will happen with interest rates or the financial markets. You can’t control your health and what kind of care you may need in retirement. You can’t even control how long your retirement will last.
However, you might be under the assumption that you can at least control when your retirement starts. After all, you get to decide when you retire. If you feel you can afford to retire early, you have the right to do so. Similarly, if you need to catch up on your retirement savings, you have the option to push back your retirement date.
Are you helping your adult child by making some or all of their student loan payments? Or did you even take out student loans yourself to pay for their education? You’re not alone.
According to estimates from the Government Accountability Office, as of 2015 there were 2 million holders of Direct Plus Loans from age of 50 to 64. There were an additional 200,000 Direct Plus Loan holders over the age of 65. Those numbers have more than doubled since 2005.1
Direct Plus Loans are a type of loan that a parent can take out to pay for a child’s education. Parents often choose to take these types of loans because they think they’re in a better position than the child to make the payments, or because they don’t want to see their child start their adult life in a challenged debt position.
Over the past several decades, breakthroughs and innovation in medicine, fitness and nutrition have resulted in people living longer than they ever have before. In fact, the Centers for Disease Control and Prevention found there’s a record number of people in the United States over the age of 100.1 A Pew report shows the number of 100-plus-year-olds worldwide will increase eightfold by 2050.2
Have you hesitated to explore an annuity as part of your retirement planning? If so, you could be missing out on a tool that is helpful for generating income and managing downside risk. While an annuity isn’t appropriate for everyone, it can be useful in the right situations.
Annuities are offered in a wide range of different types, all of which serve different purposes. Deferred annuities offer a chance for growth and accumulation, often with downside protection. Immediate annuities don’t provide growth or liquidity, but they usually generate a guaranteed* lifetime income stream.
If you’re like many retirees, your 401(k) may be your single biggest retirement asset. The 401(k) plan can make for an excellent retirement savings vehicle. It offers tax-deferred growth while funds are in the account, allowing your earnings to compound quickly. Also, if your employer has a generous match, you may get the benefit of additional contributions into the plan.
As you near retirement, though, you’ll have to start thinking about your 401(k) not as an accumulation vehicle, but rather as a distribution tool. You will likely have income from Social Security and possibly even a pension in retirement, but you may also need income from your savings to fill in the gaps.
Do you have resolutions for the New Year? It’s not too late to make one. While many people make resolutions to get in shape or pursue a new hobby, you may want to make 2017 the year you take control of your retirement planning. Whether you’re quickly approaching retirement or still many years away, it’s always a good time to reassess your planning and make adjustments.
Below are three action steps that can have a big impact on your planning and your financial future. Sticking to just one of these resolutions could strengthen your financial stability and help you have a more comfortable and enjoyable retirement.
Imagine getting in your car to start a long road trip. Before you leave, you probably enter your destination in the GPS. As you drive, you pay attention to the device and follow all of its instructions. And yet, you somehow end up at the wrong destination.
How does that happen? Pretty easily if you input the wrong destination. Plans are dependent on their inputs and assumptions. It doesn’t matter how closely you follow the plan if the plan itself is built on faulty logic.
What will your sources of income be in retirement? If you’re like many retirees, you will depend on Social Security to an extent. You may be fortunate enough to have an employer pension. To cover any gaps, you will likely have to take distributions from your personal savings.
Even with these combined income sources and more, you still may find yourself living on a fairly tight budget. Many retirees are comfortable and are able to pursue their favorite activities, but they’re also only one unexpected cost away from being in a challenging financial position.
Principal of BAM Advisory Group