Will You Live to 100?
Your odds of becoming a centenarian may be improving. Earlier this year, the Centers for Disease Control reported that the population of American aged 100 or older rose 44% between 2000 and 2014. One of the greatest challenges presented in living such a long life is paying for it. 1,2
The Pew Research Centers says the world has more than four times as many centenarians in 2015 as it did in 1990. This fact alone should be the encouragement you need to take a serious look at your need for retirement planning. When planning for your retirement, especially one that could last 35-40 years, it is important to consider all your options. One of our retirement planning tips for you is to keep investing in equities. 1,2
Keep Investing in Equities.
The S&P 500 does not automatically gain 10% or more each year but it certainly has the potential to do so in any year. As the benchmark interest rate is still well below 1%, fixed-rate investments are not producing anything close to double-digit returns. Some fixed-rate vehicles are even failing to keep up with the current inflation rate (1.5%). Turning away from equity investment in retirement may seriously hinder the growth of your savings and the level of your income.
Is the Growth Worth the Risk?
Investing your money in the stock market, like any investment, has risks. But, it also has more potential to grow. An ideal way for you to grow your retirement nest egg and spread out some of the risk that comes with investing in individual stocks is to properly allocate your investments and invest in an index, like the S&P 500. Remember, as discussed in one of our earlier posts, being too conservative while saving for retirement is one of the biggest challenges faced by those preparing for retirement. Picking an asset allocation that you’re comfortable with is key to a successful retirement plan.
Are You The Next Centenarian? Keep Investing in Equities.
No matter how old you are or how far off retirement may seem, the time to start strategically saving for retirement is right now. A great way to help grow your nest egg to help compensate for the longer life spans we are now seeing is to keep investing in equities.
Contact us today to get started saving for retirement or to check up on a plan you already have in place.
Citations
1 - money.usnews.com/money/blogs/planning-to-retire/articles/2016-01-22/how-t0-finance-living-until-100 [1/22/16]
2 – pewreasearch.org/fact-tank/2016/04/21/worlds-centenarian-population-projected-to-grow-eightfold-by-2050 [4/21/16]
3 – https://www.fidelity.com/viewpoints/retirement/why-you-need-stocks [10/27/16]