Baby Boomers Retirement Problems Jeff Bezos Won't Have To Face!

It seems unimaginable but 10,000 baby boomers turn 65 everyday and most of them will face retirement problems that they aren't even aware of. Baby boomers will face three problems in their pursuit of retirement.
First, most boomers will live longer than they anticipate. You might think that it is odd that I am referring to this likelihood as a problem but it will be a problem if they don't have enough money. Let's look at the facts on these 10,000 65 year olds that are retiring every day. The average life span of a man in the U.S. is around 81 and for women it is 86. However, that doesn't really tell the story. If a man reaches 65 he has an 81% chance of reaching 70, a 42% chance of reaching 80 and a 10% chance of reaching 90. For women the chances of longevity are even greater. A 65 year old woman has a 90% chance of reaching 70, 62% chance of reaching 80 and a 25% chance of reaching 90. Once you hit 65 you more than likely will live longer than you imagined.
The second problem relates to the first. Most boomers aren't saving enough for retirement. In fact, half of baby boomers haven't saved anything for retirement. This represents a major hurdle and a future hardship for boomer retirees who are going to live too many years in poverty and dependence. Boomers can start to rectify this problem by starting to aggressively save. By agressive I mean about 17% of your income. If you haven't been saving than this may seem like an impossibility.

The third problem is that most Americans, including seniors, don't understand Medicare costs well at all. While part A of Medicare is free the rest of it is not. In fact, many retirees who had great health plans in their jobs may actually find themselves spending more money for Medicare than they did for their company health insurance. The average cost of part B can be $109 to $140 a month. Plan C, medigap, can run from 0 to $300 a month but usually lower than plan B. Plan D drug coverage can run around $40 a month. So a couple could theoretically spend $550 to $650 a month for healthcare coverage. While the politicians push Medicare for all and many millennials think it's free the reality is it can be costly for many folks.
The moral of the story is to start saving for retirement early and generously to help preclude some of these problems.

Hard Truths About Retiring At 55 Pro's And Con's From Industry Experts

Retiring at 55 is becoming more and more a reality for thrifty and ambitious young Americans and most people only think of it in terms of the "pros" but experts warn that there are indeed some very real "cons" as well.
With the average age span of U.S. citizens ever growing (86 for women and 81 for men) it is really quite amazing that so many are trying to retire early. A young person who is entrepreneurial and a savvy investor can make this retirement age a reality but there are some things to keep in mind before you actually pull the plug on your career.
First, we will examine the pros of an early retirement. First, you can actually pursue a hobby or job that involves your passions. For most of us our job is just a job. The experts go as far to say that 70% of us hate our jobs. Retiring in your 50's allows you a chance to do what you love.
Second, bye-bye stress. Job related stress is a very real phenomenon, in fact , it can wreck your health. Retirement is truly a remedy for this condition.
Third, no more windshield time. I have a love one who lives and works in Tampa, Florida. One of the perks of their job is that they can work from home. If you have ever driven in Tampa you know that this is a real benefit. Early retirees don't have to deal with this nightmare ever again.
Fourth, follow your entrepreneurial dreams. When we are working our jobs we just try to pay the bills and keep our heads above water. There is no time to take risks and launch a business. Retirement provides the safety net to take the chance and start your own side hustle.
Fifth, enjoy life while your health is still relatively good. Sadly, when most people retire at 66 or 70 they find that they are in the beginning stages of failing health. Early exit from the daily grind gives you a shot at enjoying your leisure days in health.

Now for the cons. First, if you retire at 55 you are leaving your job at your peak earning years and this will have an effect on the amount of Social Security you may collect on a monthly basis. Remember that Social Security determines your benefits based on your best earning years.
Second, you can't access your retirement account until age 59 without a stiff penalty. If you have enough regular savings then this is no problem. You also can't draw Social Security until 62!
Third, you might get bored out of your gourd as my mother used to say. Boredom is a real problem for those who retire early without a clear cut plan for what you intend to do with your time.
Fourth, your skill set becomes outdated and you might have a hard time re-entering the workforce in the event that you have to or just want to return.
Fifth, and this is a big one! Health insurance costs are going to be Biblical in proportion to your income unless you qualify for some Obamacare subsidies. You better explore the costs of healthcare before you take the plunge into early retirement.
Those are some considerations that you should ponder but it doesn't hurt to ponder and my hat is off to those who can make this dream come true!

Why You Should Focus on Improving Asset Allocation By Age And Net Worth

The fact that you are reading my blog post is a pretty good indication that you have an interest or concern about your investment strategy especially your asset allocation. By asset allocation I simply mean that you should be keenly interested in how much of your portfolio is invested in either stocks, bonds or cash.

It goes without saying that those decisions are greatly influenced by your age and then less importantly to your net worth. If you are in the final five to seven years before your projected retirement then you should really be feeling an emotional aversion to risk.
I know a little bit about risk. I am in my early sixties and I have an eye on retirement. I had been pretty "hands off" when it came to my investment funds. I was putting too much trust in target date funds which most of you know don't really protect you very much in big down turns. I found out the hard way in December and then January of 2019. I decided to do something about my stock exposure.
I know what you're thinking, "This guy should have been all over asset allocation a few years ago"!
But I wasn't and now I'm doing a little catching up and I have to say that the last several months have been way less stressful in market down turns and surprisingly profitable in the up turns. I owe my good fortune to a blog called SmartAsset. 
This blog post contained a formula called The 100 Rule. This rule simply states that you take your age and subtract it from 100. The number that you come up with is the percent of your portfolio that should be invested in stocks. In my case, 100-63= 37. I should be in the stock market with only 37% of my investments.
I was so impressed by this formula that I made adjustments. I got out of the stock market with the exception of about 25% and invested the rest in bonds and money market funds. I have found that 25% still provides an opportunity to reap rewards when this great Trump economy is having a great week. I have also found that I don't chew my finger nails when the sky is falling.
Since folks are living so much longer than they were 20 years ago it makes sense to keep in the stock market throughout your retirement. I plan to keep adjusting my portfolio as I age and I would recommend the same for my readers.
If you are reading this post and you are 30 then I hope you are taking the 100 Formula seriously and aggressively investing 70% of your holdings in stocks. Time and risk are on your side.
I didn't really address the issue of net worth in this post and the title indicated that I would. I would simply say that net worth should not be that much of a deciding factor unless you are ridiculously well off and a market blood bath doesn't even register on your Richter scale.
I hope that this post has been helpful and I hope that you are making mad progress toward your investment goals.