LAFAYETTE, Ind. (WLFI) - Since the Social Security program began in 1935, we as a society have come to think of 65 as the age to retire. Now, that's not always the case.
According to a poll conducted by insurance giant Northwestern Mutual, 32 percent of those surveyed plan to work into their seventies. Some even expect to work into their 80s before they can retire. You can read more of the survey results via Northwestern Mutual's website.
Since 2008, trends show people are working longer. In fact, U.S. News & World Report published an article this past January on the impact of the "Baby Boomer" generation working past 65. You can check out the article on the magazine's website. So even if you are nowhere near retirement yet, this trend still affects you.
We interviewed President & CEO of Bison Financial, David Vorbeck, about this trend and asked him how planning for retirement has changed since 2008.
"Since 2008 what of course has happened is we've had this horrible recession that has for better or worse affected people in ways that have not just redefined how they plan to retire but how they plan to live," he explained.
In addition to the recession, he pointed out the fact that people are living longer. You have to take that into account in your planning because instead of saving for 10-15 years of retirement, you could live 20 even 30 or more years past the time you stop working.
"People are buying smaller houses, they are buying less expensive cars, they are spending less and certainly consuming less," Vorbeck said, although he acknowledged he has clients who are bucking that trend.
"The thing that everybody should remember is that retirement planning and having that nest egg is about time and money."
Vorbeck's advice echoes the general message to young workers: start early.
When asked how early should you start saving for retirement, he said "as young as possible." The moment you receive that first paycheck. If you don't think you have enough money, think again. Vorbeck said you can start an account with as little as $25 a paycheck.
"The old adage of 'pay yourself first' is really important."
Financial planners like Vorbeck can help you look at different options that best fit your needs and the lifestyle you hope to have in retirement. Another good place to start, he said, is with your employer. Does your company offer a 401(k) or a matching 401(k) program? Or a pension plan?
The most important thing you need to remember, he said, is that you are in charge of your retirement planning. Don't plan on the government or someone else to do it for you. Sitting back and holding out hope that you'll be ready when the time comes can be a little dangerous.
"It really is going to be about what you do as an individual."
Having enough money to retire and to stay retired is a big concern. Here's another one: health care. One retiree we spoke to said "let's hope Medicare is still around" and shook his head when talking about health care costs.
We don't know exactly what the future holds for Medicare, or Social Security for that matter. That's why planning is important. There are also other options, like long term care insurance for example, that you may want to consider.
"It's insurance that will help pay, either all or in part (however you set up your individual policy) of the services you may need either in your home or an assisted living facility," said Traci Goudy, owner and operator of Homecare By Design.
The primary focus of Goudy's business is senior care. Homecare By Design accepts long term care insurance. Goudy said she has been working with seniors for more than 20 years and it's been an education for her, one that she has a passion to pass on to others.
"I quickly realized I don't want this to happen to my grandma. I don't want it to happen to my mom. I don't want it to happen to me, honestly," Goudy said when talking about the traditional nursing home facilities.
Goudy said you want to give yourself plenty of options when it comes to your lifestyle and health care.
"Senior living options are so new, even in our community and in, in the nation," she said.
Have you thought about what you want? Assisted living, a senior living community or moving in with family? Do you want to be able to stay in your own home? Goudy said these are questions you want to ask yourself sooner rather than later. She said senior care can be layered, tailored to your needs and it can be cost-effective, too.
"I have found in 25 years of working with seniors, that we want the same amount of freedom, choices and independence, dignity and respect as we did when we were 20, 30 and 40. Why should that change?" She said.
Vorbeck said retiring in a post-recession era shouldn't scare you.
"The interesting thing about 2008 is that it isn't as remarkable as we like to think it was," he explained.
Vorbeck expects the financial future to be a lot like recent weather patterns. Plan for the droughts and the floods. He said there will be more ups and downs in the
economy but if you prepare, you'll be able to weather any financial storm.
If you would like more information on long term care insurance, the federal government operates a website with information. You can also ask your insurance agent about policies that would fit your needs.
Sources for this story:
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