{"id":6219,"date":"2017-03-06T08:10:52","date_gmt":"2017-03-06T12:10:52","guid":{"rendered":"https:\/\/kerryhannon.com\/?p=6219"},"modified":"2017-03-06T08:10:52","modified_gmt":"2017-03-06T12:10:52","slug":"how-not-to-outlive-your-money-in-retirement","status":"publish","type":"post","link":"https:\/\/kerryhannon.com\/?p=6219","title":{"rendered":"How Not to Outlive Your Money in Retirement"},"content":{"rendered":"
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<\/a>Five days a week, Kim Moske makes a peanut butter and jelly sandwich and brown-bags it to work. \u201cI\u2019ve been doing that for 30 years and saving what I would have spent eating my lunch out someplace,\u201d she said. \u201cThat\u2019s added up to a lot of money, and truthfully, I don\u2019t care what I eat for lunch.\u201d<\/p>\n

That is a small gesture, but it is indicative of the advantages of making daily choices to help save for a financially secure retirement<\/a>.<\/p>\n

Ms. Moske, 56, lives in Delaware, Ohio, and is a project manager for a small manufacturing firm. She expects to retire in six years. But it has not been all about homemade sandwiches: She started to save and invest in her late 20s.<\/p>\n

That foresight and discipline have made it possible for her to envision a fairly traditional retirement \u2014 one that will allow her time to pursue hobbies like gardening, hiking in Hocking Hills State Park or biking along the Olentangy River near her home, and traveling.<\/p>\n

\u201cI\u2019m not one of these who has to go to Paris, but it would be fun to finish seeing all the 50 states,\u201d she said. \u201cI\u2019ve visited 30 of them.\u201d<\/p>\n

READ HERE AT THE NEW YORK TIMES<\/a><\/strong><\/p>\n<\/div>\n<\/div>\n

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Ms. Moske grew up in a family \u201cwhere we were always getting utilities shut off,\u201d she said. \u201cWe lived in fear that our car would be repossessed, and we frequently ran out of milk. I was raised by two people who were very good at wasting money and very poor at managing it. They were a financial disaster.\u201d<\/p>\n

\u201cMy father worked very hard his entire life and made a good income, yet he died penniless at age 78,\u201d she said. \u201cI\u2019m frugal to a fault. Therefore my retirement is in pretty good shape.\u201d<\/p>\n

Ms. Moske is proof that it is never too early to start working on your retirement plan. Fewer workers today have traditional pensions than in the past, life expectancies are generally longer and, with unknowns like health care costs and inflation in the coming decades, planning is more important than ever.<\/p>\n

When Ms. Moske was 26 and working full time to pay her way through college, she signed up for a class on finance and investing. \u201cI didn\u2019t know a stock from a cornstalk, but I realized that I needed to take control,\u201d she said. \u201cMy husband and I immediately started living on less than what we needed, saving and investing.\u201d<\/p>\n

Money was tight during the dozen years that she stayed home to raise the couple\u2019s two children, now 20 and 22. She also missed out on those years of employer-provided retirement savings.<\/p>\n

Then, six years ago, her husband died from injuries sustained in a fall. That caused a seismic shift not only emotionally, but also financially, as she had to live on one income. But she paid off her home, now valued at around $300,000, with a portion of the money she received from her husband\u2019s life insurance<\/a> policy.<\/p>\n

\u201cI will be fine,\u201d she said. \u201cBut I don\u2019t go it alone: I meet with a financial planner<\/a> once a year to make sure I am on track, and I check retirement calculators all the time.\u201d<\/p>\n

In many ways, she is an anomaly.<\/p>\n

\u2018Work More, Save More or Both\u2019<\/h4>\n

Unlike Ms. Moske, many Americans are not ready for retirement. \u201cNearly half of families have no retirement-account savings at all,\u201d says a report<\/a> by the Economic Policy Institute, an independent nonprofit think tank that researches the impact of economic trends and policies on working people in the United States. The median retirement savings figure among all working-age families in the United States is just $5,000; the median among families with savings is $60,000.<\/p>\n

According to the Fidelity Investments Retirement Savings Assessment<\/a>, 55 percent of American households risk not being able to cover essential expenses like housing, health care and food in retirement.<\/p>\n

Fred Blanton, a business and marketing consultant in Houston, does not have \u201ca big golden nest egg,\u201d he said. \u201cI\u2019m going to be 65 in a few months, but I need an income. I have enough money if I live another 15 years, but am I going to die at 80?\u201d<\/p>\n

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Don Blandin, president and chief executive of the nonprofit Investor Protection Trust, which worked with Detroit Public Television to produce the documentary \u201cWhen I\u2019m 65: Rethinking Retirement in America.\u201d Photo courtesy of IPT<\/figcaption><\/figure>\n

Mr. Blanton\u2019s fear of outliving his savings is heartbreakingly real. \u201cWe are now living longer and have to recognize that we either have to work more, save more or both,\u201d said Don Blandin, president and chief executive of the nonprofit Investor Protection Trust<\/a>, which worked with Detroit Public Television to produce the documentary \u201cWhen I\u2019m 65: Rethinking Retirement in America<\/a>.\u201d<\/em><\/p>\n

\u201cThe 65 retirement age for Social Security<\/a> was put in place in 1933 when retirement lasted eight to 10 years,\u201d Mr. Blandin said. \u201cIn the old pension system, people didn\u2019t have to make decisions on how much to contribute to a retirement account, which investments to grow their nest egg, how big of a nest egg they would need, what to do with the nest egg when changing jobs and how much to withdraw on an annual basis in retirement.\u201d<\/p>\n