Planning for retirement? Plan to live to 100

There is a fiercely debated question among many advisers and financial planners.

 What should the time horizon be for retirement? 

People are living much longer than previous generations and researchers are now saying we should be planning for 30 to 40 years in retirement. 

“Economics is crystal clear that the right planning horizon is one’s maximum, not one’s expected age of life,” said Larry Kotlikoff, an economics professor at Boston University. “We need to plan to live to the maximum age of life for the simple reason that we might.” 

It is an important question to ask because planning for a three or four decade retirement means you need to save perhaps a lot more money for longer than you ever thought. Failure to do so could mean running out of money in retirement. 

Need help with setting up a savings plan for retirement? Please email me at gszlagowski@assante.com. 

Source: Planning for retirement? Plan to live to 100 by Robert Powell, MarketWatch April 12, 2012, 12:01 a.m.