The New Face of Retirement… Things Aren’t What They Used to Be

Remember that 4% withdrawal rule we always heard about?  Well it just might not really work with interest rates so low. On top of that, there is a wage gap for women. According to a report released in April of 2016, The Devastating Long-Term Effects of the Gender Pay Gap— And How Women Can Begin to Address Them, the disparity in the pay gap for full-time working women can total nearly $500k over the course of a women’s career. Then consider that women are living longer. In fact we all are – so we have longevity risk that we need to plan for appropriately when developing our retirement plans so that we do not run out of money.

Couples are getting divorced at a ridiculous pace, so perhaps it makes sense to consider running a retirement projection as if you were to divorce. Planners could treat a divorce  like a “long-term care event”, and even if you are not considering a divorce, it is prudent to understand the potential financial impact on your retirement plan and test the success rate of the modified scenario. Better to be safe than sorry. It may even deter a divorce or two. Who knows?

Click to read more about 5 Retirement Assumptions You Can’t Make Anymore

Work with a professional for comprehensive advice on strategies that address your specific retirement planning needs.

The Author facilitates a monthly Divorce Resource Workshop in North Scottsdale/North Phoenix called “What Everyone should know about Divorce” sponsored by Second Saturday.