Retirement has changed. There’s no more gold watch ceremony, thirty, forty or fifty year milestones, and for the most part, pensions to carry you into the new paradigm of life. It’s a down and dirty, fend for yourself game that our parents don’t understand, and our generation is struggling with.
As a Certified Financial Planner™ since 1991, my professional role for the past 20+ years has been financial and estate planning. I see a new responsibility forming in my profession- “Longevity Planning:” the task being helping folks plan for the long haul. Quitting work at age 62 is not far from a myth for most, and working long into their 60’s or 70’s has become commonplace in today’s working world. I am a great believer in keeping the mind busy and challenged every day. As an example, look at the team at the CBS News program 60 Minutes: most are in their 70’s, some in their 80’s. Andy Rooney just retired at age 94. I am in awe of the sharpness of their minds and the great articulation of their speaking; they retain their sharpness even into their “advanced age.” Why? I believe it‘s because they chose to keep their minds sharp by reading and seeing information to process though their brains on a daily basis. It’s akin to the phrase “use it or lose it.”
Longevity Planning (as I call it) is the practice of looking higher on mortality tables and that our generation is just fixed on living longer, planning is not just about retirement- it’s about providing money to fund a longer lifespan. While living longer is nice (hey…it beats the alternative) there are some pitfalls that come with it.
Ill health can impede the plan. If the plan is to live longer, chances are that health maladies may cut into the plan. While there have been massive amounts of studies about diet, exercise and ways to stretch your lifespan, the fact is that genealogy has a lot to do with our health. With ill health come heath care costs-the biggest facet of expense for the retirees of these United States. Many struggle with the conflict of quality of life vs. paying for healthcare. It is truly a dilemma that I hope you never have to deal with.
Once you reach the age of 65 you qualify for Medicare. However, there is a big (huge) gap between what you expect to be covered, and what actually is. To bridge this gap, most retirees at age 65 purchase Medigap Insurance to cover these very gaps in Medicare coverage. In order to avoid older Americans taken advantage of by unscrupulous insurance agents, a standardized plan was put into place many years ago so that all companies can only sell the same plane, with the plans names “A-N” (currently). While the companies may be different, every companies “Plan A” is exactly the same: the only difference is the company and the cost, but the coverage is exactly the same. This allows for a standardized choice for the proposed insured to pick from, with no riders or variations. While the plans have varied throughout the years, when there is a change, it is a change for all companies as the plan is dictated by Uncle Sam, not the individual companies, hence the continuity of coverage. Just pick the company you want to deal with, and “Plan A” is “Plan A” regardless. Currently, the plans offered are individual Plans A, B and C, – F, K and L, – or M and N.
Do your homework before your 65th birthday. Keep on saving- and get ready for the best time of your life!
