Retirement Plans Being Jeopardized? Want to Add To Your Retirement Funds?

Risks to Your Retirement Income

If you’re a member of the “Baby Boomers,” you’re probably giving serious thought to retiring – if you haven’t already started your retirement.  Even if you have already left work, it’s likely that you’re wondering whether you’re financially able to remain comfortably retired.

Today’s financial crisis compounds the retirement question substantially by increasing the following retirement related risk factors:

1. Average Life Expectancy Has Grown

Current life expectancies are longer than their parents. For example, in 1970, a 60-year old white male would have had a life expectancy of only 16.2 years; but, by 2008, his life expectancy had climbed to twenty more years of life.

So how is the retiree going be able to afford retirement during those additional 3.8 years? There are only a few probable answers to that question:

> Expedite current savings

> Work longer than planned

> Move in with children or other family members

> Get by with a reduced quality of life

2. Spiraling Health Care Costs

Predicting and planning for ways to cover one’s health care coverage are some of the most difficult financial activities, largely because requirements are so person-specific, with requirements differing greatly between spouses. Long-term care needs are even more difficult to predict and arrange adequate funding.

Health care costs have grown more than 5% (inflation adjusted) for the past 15 years – and that is higher than the increase in family income. Medicare costs are expected to rise at similar rates.

3. Legislation May Limit Retirement Income & Benefit Programs

It is well known that the expenses associated with the major social programs (e.g., Social Security, Medicare, and Medicaid) are growing faster than other parts of the economy, and some economists question their long-term viability due to the combined effects of increased life expectancy, size of the retiring population, and rising health care expenses in general.

Further, immediate questions concerning continued health insurance in retirement, and at what benefit levels, are rampant in today’s economy – and these questions are further fueled by auto industry, and other, corporate reorganizations.

There is currently a lot of debate concerning a national health care system – but such conversations have been ongoing for decades, with few results to show for those efforts. Although President Obama will be leading such efforts this year, many people anticipate Congress to present a lot of opposition.

Most people expect that people over age 55 will be protected from reductions in these social programs, but providing complete coverage for them is a two-edged sword – doing so increases the likelihood of a new tax, which would likely add to the tax burden for retirees.

4. Sometimes One’s Retirement Date is Dictated, and not a Free Choice

According to a 2004 Health and Retirement Survey (HRS), 37% are forced to retire due to poor health or recessions, etc.

5. 401Ks Became 201Ks

Did your 401k and other retirement savings take a major hit with the stock market meltdown last year? My savings took a major hit. Many people saw their 401k and other stock market accounts take a 50% hit, which has led many comedians to rename them “201k”. For many people, their 401k was the bulk of their retirement savings, so this stock market crash seiously damaged their retirement plans.

Humpty Dumpty Was Not a Retirement Expert

Some of the news is good news. You can fix a broken “nest egg”.

You can work an extra year or two, take a part-time job or work from home to supplement your earnings, start your own business, etc.

If you’d like to start an online business, but are hesitant because you’re not an internet expert, a excellent place to start for gaining all the understanding about internet marketing that you’ll need to be successful is to enroll in the Online Success for Beginners course.

A study by Butrica, Smith and Steuerle (2006) noted that working just one (1) extra year can increase annual retirement income by 9%, while working just five (5) extra years results in an extra 56% annual retirement income.

If you’d like to learn how to produce a second income, so that you can have a rewarding, financially secure retirement, check out Darren Salkeld’s new MaxPro Marketing System and get his FREE Report and FREE Audio describing the age-old secrets of creating wealth.

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