Weekend Reading: Five Ways to Manage the Longevity Risk in Retirement
This article appears as part of Casey Weade's Weekend Reading for Retirees series. Every Friday, Casey highlights four hand-picked articles on trending retirement topics and delivers them straight to your email inbox. Get on the list here.
We’re all in the midst of a longevity revolution, but in order to make the most of a potential 100-year life, it’s important to prioritize quality over length.READ THE ARTICLE
Live long and prosper: If you’re going to live past your life expectancy, you certainly want those years to be fulfilling, and building a retirement plan in preparation for that can help alleviate uncertainty surrounding your longevity. Past Retire With Purpose podcast guest, Steve Parrish, highlights five factors to focus on here. They include:
📌 Social Security: One way to account for longevity risk is to delay filing for Social Security benefits (ideally until age 70); however, this requires supplementing with other income sources until then, which might include tapping your IRA, utilizing an annuity or taking out a reverse mortgage.
📌 Annuities: These investment vehicles are designed to lock in retirement income for life, but determining which product could best supplement your portfolio begins with consulting a professional.
📌 Long-term care insurance: Roughly half to two-thirds of older Americans will require long-term care at some point, which is why long-term care insurance is so important to help absorb the steep costs that can come along with that.
📌 Investment strategies: There comes a time when your stockpiled savings inside a 401(k) or IRA must be put to use. Strategically withdrawing and growing that money is key to a sustainable retirement income.
📌 Medicaid: If financial resources are limited, Medicaid can act as a safety net to help cover the costs of housing and medical care as you age.
Prioritize longevity planning: There are dozens of ways for you to insulate your life savings against the risk of outliving it. Take a diversified approach. Doing nothing isn’t an option.