How often do you think about retirement?
Most of us think about it a lot — at least four times a week.1
You've reached the retirement summit - now what?
We put a lot of time into saving and investing money for retirement, but we don’t spend nearly as much effort developing a strategy for withdrawing those assets once we retire.
However, developing a retirement strategy is similar to planning a mountain trek — how we get down from the peak is just as important as how we scale up it.
If it seems like the cost of, well, everything has gone up lately, it’s true.
The inflation rate jumped in the first half of 2021, leading to price increases on everything from gas and groceries to bigger ticket items such as cars and homes.
The jump in inflation can be especially jarring after nearly a decade of steady, low rates.1 But what causes fluctuations in the inflation rate?
And most importantly, could rising prices pose a risk to your plan for retirement?
This topic is showing up more often in news stories which can cause anxiety. As with all financial decisions, it's important that we gather information and think logically about how inflation could impact our future plans
Today we'll explore some of the common questions about inflation. We’ll also look at how to think about inflation as you plan for a retirement that could span 20, 30 or even 40 years.
Cola and Social Security.
The news keeps getting better for Social Security recipients.
It's now projected that benefits will increase 6.1% in 2022, up from the 4.7% forecast just two months ago. That would be the most significant increase since 1983.1,2
It’s all about inflation. Social Security cost of living adjustments (COLA) are based on the consumer price index, which rose 5.4% in June — its largest 12-month increase since 2008. The official announcement is expected in October and, once it’s confirmed, the revised payment will go into effect in January 2022.3
More than 65 million Americans receive Social Security, and the annual cost of living adjustments are designed to help recipients manage higher costs. At the start of 2021, recipients saw a 1.3% increase.4
A practical financial checklist for the future.
When our parents retired, living to 75 amounted to a nice long life, and Social Security was often supplemented by a pension. The Social Security Administration estimates that today’s average 65-year-old woman will live to age 86½. Given these projections, it appears that a retirement of 20 years or longer might be in your future.1,2