If you live to be 100 years old, or even 90, will your money last as long?
That is an important question for retirees and near-retirees to ask themselves. Some may wonder, with all of the items to consider, if it can even be answered.
You may want to consider the factors you have a greater degree of control over, such as your savings and spending rate, along with how your assets are invested. You may also consider the looming issues over which you may not have immediate control—such as inflation, the length of your retirement, and health care costs.
It can be challenging to assimilate all of these components to determine when you can afford to retire and how much you can spend annually to be confident that you will not outlive your assets. At Janney Montgomery Scott, we realize this is a significant concern of many of our clients. As a result, we have developed an application designed to specifically address these concerns—the Retirement Income Evaluator (RIE).
The RIE tool can be customized to incorporate your particular circumstances and can help answer the following questions: 'Will your assets and income support your retirement goals?' and 'What actions can you take now to better align your financial decisions with those goals?'
Although you cannot directly control factors such as the elements of inflation, the length of your retirement, and rising health care costs, the RIE application can help you understand and plan for them. For example, the RIE tool can provide various scenarios to help you compare the expense of an extended hospital stay for you or a family member with the cost of long-term care insurance, as well as the impact of these expenses on your planned retirement spending, income, and investment balances.
We have saved the best for last: the RIE tool is interactive. If your specific information is entered into the RIE application, we can then view a “picture” of your retirement years that includes modeling the “what if” scenarios you could face in the future.