Saving for retirement just the beginning

The five factors in reaching retirement income goals: longevity, inflation, asset allocation, withdrawal rates and health care expenses.  Read the excerpt below.

North County Times - Escondido,CA,USA

By: CANDACE BAHR - For the North County Times

Most people understand the importance of accumulating wealth for retirement.

But there is another critical component of retirement planning that many have not considered ---- once you have accumulated those retirement assets, how do you make your income and assets last through your lifetime?

There are five factors that affect your success in reaching your retirement income goals: longevity, inflation, asset allocation, withdrawal rates and health care expenses.

- Longevity. Based on actuarial tables, half the population will outlive their life expectancy. A 65-year-old man in good health has a 50 percent chance of living to 85, and a woman has a 50 percent chance of living to 88. And there's an equal chance that at least one member of a healthy 65-year-old couple will live to age 92. That means they may need 30 years of retirement income.

- Inflation. In 25 years, at just 3 percent annual inflation, your expenses could double. If your expenses today are $72,000 a year, you'll need more than $150,000 to meet those same expenses in 25 years. Include investments in your personal retirement savings with the potential to beat inflation ---- especially considering the greater longevity that today's retirees can expect.

Read the entire article:

http://www.nctimes.com/articles/2007/02/15/business/bahr/19_28_362_14_07.txt