Page 149 - Ready Set Retire

Ready. Set. Retire!

coincidentally, with Morningstar’s “2.8% Rule,” but actually a
lot safer.

Let’s try another way. If you are 65 years old and male, your
life expectancy is right around 82. If female it’s about 84. It’s
important to understand the term, “life expectancy.” All it
means is that by the time you reach 82 or 84, half the people
65 at the same time you were are now dead. Half of them are
still alive. Further, if you are one of the lucky ones still living,
your life expectancy is now around 88. And if you live to 88 it
goes into the 90s. So the longer you live, the longer you can
expect to live.

So, at age 83 (average of 82 and 84), half the people are dead,
but half are still alive. Which half do you plan to be in? Do you
think you will be lucky enough to live past 83, or do you think
you will die sooner? If you knew, it might make a difference in
how you plan, right?

But, as Yogi Berra once said, “It’s very difficult to make
predictions, especially about the future.” So, the prudent
planner would plan for a long life expectancy. But at what cost?

If you went back to that $500,000 example mentioned above,
and planned for just 15-17 years, it could make quite a
difference in your lifestyle, couldn’t it.

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