Avoiding the Retirement Postponement Strategy

A standard retirement planning recommendation heard these days from financial advisers is to postpone your retirement and work longer.

Who wants to hear that? That “strategy” is almost as bad as unretirement. The folks who are telling you to delay your retirement are the same “experts” who put you in high risk investments to begin with.

Here is a story about a physician who has twice changed his retirement plans. The first delay was caused by the post-9/11 market crash, which caused a 50% drop in his retirement investments. That moved his planned retirement age from 55 to 60. Now he is delaying his plans again because of the 2008 market crash.

What if it happens again? And again?

There is a better way. Use at least part of your retirement savings to fund a guaranteed income plan. Fund that income plan with investments that cannot go down in value and that cannot be damaged by inflation. Then when your planned retirement age arrives, you retire, no matter what has happened to the market. Bingo.

Maybe the process of designing your guaranteed income plan will cause you to adjust your retirement income expectations, but so what? It’s a lot easier to do that than to sit by and watch the value of your conventional stock and bond investments fall off a cliff, completely destroying your plans.

Don’t be a victim. Take control. Think about it.