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10 Retirement Issues:

10 Retirement Issues:. Dr. Cynthia Crawford University of Missouri Extension. Issue 1. How much income will you need?. Rule of thumb is that you’ll need 70% to 80% of your income to maintain your lifestyle in retirement.

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10 Retirement Issues:

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  1. 10 Retirement Issues: Dr. Cynthia Crawford University of Missouri Extension

  2. Issue 1. How much income will you need? • Rule of thumb is that you’ll need 70% to 80% of your income to maintain your lifestyle in retirement. • The closer you are to retirement, the more meaningful your individual analysis of expenses will be.

  3. The old paradigm of retirement funding – a 3 legged stool • Pension funds • Personal savings • Social security

  4. The new reality of funding retirement • Pension • Personal savings and social security • Health care insurance • Your part-time job

  5. Issue 2 – Inflation in your future • Inflation is a thief of purchasing power • If inflation averages 3.5%, the cost of living will double every 20 years.

  6. Effects of 4% inflation over 30 years • $ .60 cup of coffee will cost $1.95 • $12 restaurant meal will cost $38.92 • $100 hotel room will be $324 • $25,000 pick-up will cost $81,085

  7. Issue 3 – The “live and buy for today” mentality • You fail at retirement planning when you compromise what you want long term for what you want right now. • Happiness is a place between having too little and having too much. Finnish proverb

  8. Issue 4: Choosing between funding a child’s education and saving for retirement… • How many sources will loan money for a child’s education? • How many sources will loan you money for your retirement? • If you have to pick…

  9. Issue 5: What are your values about leaving an estate? • “If I knew when I’d draw my last breath, I’d spend my last dime at that time, too” • “It is my goal to pass on as much of my wealth to my children as I can.” • “It is important to me to make sure my children have the ability to earn a living by attending college. After that, they’re on their own.”

  10. Issue 6: What is your net worth? • You may be pleased! • Your net worth gives an idea of what may be available for retirement resources. • Your farm may be your single greatest asset.

  11. Issue 7: Will your mortgage and debts be paid by retirement? • Reduce cash flow needs • More of an issue now that people are retiring earlier

  12. Issue 8: What if I were suddenly single? • Change in marital status • Death • Divorce • Average age at which a woman becomes a widow is ___. • Life expectancy for men is ___ • Life expectancy for women is __ • The longer you live, the longer your life expectancy.

  13. Issue 9: What if I didn’t get started saving soon enough for retirement? • Guidebook to Help Late Savers Prepare for Retirement • National Endowment for Financial Education (NEFE) • www.nefe.org then select “multimedia presentations”

  14. Issue 10: Insurance adjustments in retirement • Health insurance is critical • Life-insurance may be less important • Long term care insurance may be important • Disability insurance may be less important • Business insurance needs may be less

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