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Show March 15 03.qxd 12/7/2021 Volume VII Issue XI 3:45 PM Page 7 THE OGDEN VALLEY NEWS Page 7 March 15, 2003 How to Harvest the Rewards of Retirement First in a four-part series Retirement involves making changes—to schedules, priorities, activities and finances. One of the major transitions many people experience at retirement is going from the predictability of receiving a paycheck to the relative unknown of relying on pension checks, Social Security and personal savings and investments. Information in this article and the next three issues will help minimize the stress of entering that unknown by outlining the decisions you’ll be making at retirement and offering some general advice about retirement planning. Step 1 Determining how Much Money You Will Need The amount of money you’ll need for your retirement depends in large part on two factors: 1. The number of years you will spend in retirement. This estimation is a function of your age at retirement and your life expectancy. Of course, people who retire at 50 will need a larger nest egg than those who wait until age 65. But too often, people tend to focus on their age at retirement (I’ll retire when I’m 62” rather than the length of time they’ll be retired). With today’s life expectancies, you may spend 15-20 years in retirement, on average. And many of us will live longer than that. One rule of thumb is that retirement income should be 70-80 percent of current income, adjusted for inflation. It’s important to note, however, that income needs during retirement are highly individual—there’s no “right” answer for everyone. Don’t forget inflation It’s not enough just to preserve what you have now—you need to make your money grow just to stay even with the rising cost of living. Over the past 30 years, inflation has eroded the purchasing power of the U.S. dollar by 75 percent. In other words, something you could buy for $25 in 1964 would cost $100 today. Even a modest rate of inflation can erode a retirement nest egg over time. So make sure you take inflation into account when you’re planning for retirement. Next time... Step Two: Reviewing your Financial Resources This information has been provided to you courtesy of Chris Wright, Registered Representative, Securian Financial Services, Inc., member NASD/SIPC. 98-0227-85002R One Voice on the Family By Janet K. Cazier The other day as I was pushing my garbage can down the road, I noticed that it was harder than usual. I soon realized that I was pushing instead of pulling. I immediately moved to the other side of the container so that I was pulling instead of pushing. I faced the road ahead and kept my hands behind me, holding to the handles while pulling it along. I thought about how this was like dealing with people. If you get behind them and push, it can be very difficult, and wastes a lot of energy. But if you get out in front and lead, then, for the amount of energy expended, it can be much more productive. It reminded me to face squarely the direction I am going. In this position, I can also take much bigger steps. I know if I face the garbage head on and try to pull it, I could fall, tipping the garbage all over me. Just like when you face an individual and pull, you usually get resistance . . . sometimes even anger (that’s garbage to me). But even if I never fell, I would still have to move slower, taking tiny steps so as not to fall. In this position, the garbage seems so much heavier, and it is so much more difficult. This month the challenge is to turn around and see where you are going before you try to pull others along. I know some of you are thinking that we shouldn’t pull others, we should lead them—then they can decide whether to follow or not. It’s just that sometimes my garbage won’t follow me if I don’t hang on to it. Some people in my life are somewhat like my garbage; they need me to hang on, and gently pull them along. Too bad the people in my life aren’t really like garbage, because if they were, maybe it would be easier to get them to follow. Now don’t get me wrong. I know that people aren’t garbage, but sometimes what comes off of them is. Remember that the more valuable something is, the more cautious we need to be. So please remember to treat the people in your life better than garbage, even if they act like it once in awhile. We know that garbage can challenge us to be better. They say that some people’s garbage is another person’s treasure, but my own garbage taught me a truth that is a treasure to me. So remember, lead your garbage to the place it needs to be, while holding your head high and walking in the right direction. Happy St. Patrick’s Day Why is this fact important? The longer you live, the more money you’ll need. This issue is of special concern to women, who tend to live longer than men. A note about early retirement Many people dream of retiring early (before age 62 or 65). From a financial standpoint, early retirements must be planned very carefully. Make sure you have all the information you need to make a well-informed choice. If you’re thinking about early retirement, keep the following things in mind: No benefits are available from Social Security prior to age 62, and benefits are reduced between ages 62 and 65. People born after 1937 face an increased age at which they are eligi ble for full Social Security benefits. For those born in 1960 or later, that age has been increased to 67. Many defined benefit pension plans also reduce benefits for people retir ing before age 65. The IRS will impose a 10 percent penalty tax on pension distributions made before age 59-1/2 (unless you qualify for certain limited excep tions). Enrollment in Medicare is usually prohibited before age 65. 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