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Life settlements and longevity: reducing the stress of outliving retirement income.


June 10,15 | 9:00 am

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As seniors are living longer, many in their family are experiencing the anxiety of a parent outliving their retirement income. Healthcare costs, taxes and other unplanned expenses do cut into retirement income significantly, and a life settlement can bring in much needed income and is a welcome resource in many situations. However, there are other strategies to also keep in mind to help ensure retirement savings will be there when you need it.

1. Establish a set goal for savings every month for retirement. If you don’t know what the maximum allowable 401(k) contribution is for your plan, be sure to look it up or find out the maximum from your financial advisor. It should be the number you strive for to match. And if your employer has a matching plan that you can take advantage of, you can leverage that additional money to add to your contribution amount.

2. Don’t withdraw from you 401(k) until you are at least 59 ½. If you do take out money early, you will be facing an early distribution tax. The government’s put this early withdrawal penalty in place as a way to keep us out of our retirement savings before our retirement years. Some exemptions do apply, like certain medical expenses, but it is better to check with your financial advisor on the portions of medical expenses that can be deducted.

3. Take a long-term view with the stock market.

It is always best to start a savings plan as early as possible, and most people have many years before they retire. Along the way, you are bound to experience the fluctuations of the stock market. But keep in mind that even though stocks are volatile, the potential for huge growth is always there. And although the market will go down, it inevitably will come back up again. At this point prices will climb, and you will benefit from that rebound.

Whatever your situation, make sure you speak with your financial advisor to discuss your options. If a life settlement may be a desirable alternative, then you and your advisor can visit The Ashar Group at www.ashargroup.com for more details to help you determine the most profitable alternative for your particular situation.

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