The 15-Minute Retirement Plan

Are you prepared for your retirement?

One of the biggest risks an investor faces is running out of money in retirement. This can be a personal tragedy.

People can work their whole lives to accumulate enough wealth to make sure they enjoy a comfortable retirement only to find they've come up short.

Sadly, many retirees often underestimate the length of time they will need their portfolio to provide for them and misjudge how much money they can safely withdraw during that time.

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Carefully consider your time horizon. You may live a lot longer than you think

The human lifespan has increased steadily over the past few decades. The National Institutes of Health (NIH) have shown that human life expectancy was 68.6 years in 1952. By 2006 that figure had risen to 77.8 years. Given the rapid advances in modern medicine and healthcare, there is every reason to believe this trend will continue.

The life expectancy information in the table below is from the US Total Population Life Table 2007 (revised as of 06/25/2010) National Vital Statistics Reports, Volume 58, Number 21, and rounded to the nearest year.

The bottom line? Prepare to live a long time and make sure you have enough money to maintain your lifestyle.

Life Expectancy Table

These days, you simply must plan for a longer investment time horizon than your parents or grandparents did. And don’t forget about your spouse's time horizon! Longer life expectancies present a challenge to today’s investors not faced by previous generations.

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