How to Bridge The Retirement-Income Gap
Maybe retirement isn't such a distant dream.
Sure, if you want to spend your golden years taking ritzy vacations and eating out every night, retirement will be darn expensive and you may need to sock away money for years to come. But what if you're a little flexible about your retirement dream? You could be closer than you ever imagined.
Falling Short
When you tote up your potential retirement income, you are probably looking at three key sources: Social Security, a traditional "defined-benefit" pension and your retirement savings.
Suppose you won't receive a pension, but you are eligible for $15,000 a year from Social Security. Meanwhile, you have a total of $200,000 tucked away in your individual retirement account, your 401(k) plan and your regular taxable account. Let's assume that each year, you plan to cash out 5% of your portfolio's beginning-of-year value.
This withdrawal strategy, which strikes me as reasonably prudent, would give you $10,000 in annual pretax retirement income initially and hopefully more in subsequent years. Keep in mind that if you take your dividends and interest in cash, you should count this investment income toward your portfolio's 5% withdrawal rate.
Add it up, and you are looking at $25,000 in annual retirement income. Let's say your goal is $45,000. Your challenge: somehow bridging this gap.
Leaving Home
If you live in or near a major city on the East or West coast, I am sure you have had the same thought I've had. Why not sell at today's eye-popping prices and move to a less-exuberant housing market, where you could probably buy a comparable home for half the price?
Not only would this give you extra cash to fatten your retirement coffers, but you would probably trim your living expenses.
"My brother-in-law retired in Huntsville, Ala.," says Henry "Bud" Hebeler, who runs a Web site devoted to retirement issues,
www.analyzenow.com. "The cost of living is so much lower. The utility bills are lower, real estate is cheaper, property taxes are lower and staples are less expensive."
Relocating to the other side of the country probably isn't a good idea, because you are likely to be far away from friends and family. But the change doesn't have to be that radical, says Sheryl Garrett, founder of the Garrett Planning Network in Shawnee Mission, Kan., a group of 240 financial planners who charge by the hour.
She says that if you live in or near a major city, you may be able to find both cheaper housing and a lower cost of living by moving just an hour or 90 minutes' drive farther away.
"The reality is, if all your wealth is tied up in your home, how else are you going to retire?" Ms. Garrett asks. "You could take out a reverse mortgage. But I view that as a last resort. Before you do that, I would think about downsizing the cost." To that end, head to sites such as
www.bestplaces.net,
www.homefair.com and
www.relocationessentials.com, where you can explore the cost of living in other areas.
Imagine you traded down from your $300,000 home to a $150,000 townhouse. That would free up $150,000 of home equity, which you could then add to your portfolio, bolstering your nest egg to $350,000.
Using a 5% withdrawal rate, you are now looking at $17,500 a year in portfolio income. Tack on the $15,000 from Social Security, and you are up to $32,500.
Working It Out
Even at $32,500, you are still well short of your $45,000 goal. To close the gap, you might work part-time in retirement. "I see more and more people doing that," Mr. Hebeler says. "Typically, they're working one day a week. They need the extra income."
In earlier articles, when I have mentioned the possibility of working part-time in retirement, I have received scornful emails from readers. Their argument: Anybody working isn't really retired. My hunch: This attitude will change -- for two reasons.
First, research has found that seniors who work in retirement tend to be happier. "It's much more than just the income," Ms. Garrett says. "We need to be involved and stimulated."
Second, earning a little money can make retirement a whole lot more affordable.
Suppose you earn $5,000 a year, nudging your total retirement income up to $37,500. Based on a 5% withdrawal rate, that $5,000 of income is like having an extra $100,000 of retirement savings.
True, instead of retiring and working one day a week, you could continue working full-time and eventually retire without any need for extra income. But before you go that route, think about how many years of full-time work it would take to amass another $100,000. Put that way, maybe a little part-time work doesn't seem so bad.
Spending Less
In our example, you still aren't hitting your $45,000 retirement-income goal. To narrow the gap, you might squeeze more income out of your assets by, say, using part of your portfolio to buy an immediate annuity or by taking out a reverse mortgage on your new townhouse.
But also consider whether you could make do with less, especially if you plan to move to a cheaper part of the country. Clearly, you want sufficient income to cover the basics, including medical costs, property taxes and occasional large expenses, such as replacing the car or putting a new roof on the house.
For most of us, however, our definition of "enough" won't stop there. Partly, that's because we want the money to travel during retirement and to pursue new hobbies. But also, "enough" isn't a fixed dollar amount.
Rather, research suggests that, when it comes to financial happiness, relative income and wealth are just as important. We probably won't be happy if our retirement income is a lot lower than the salary we used to collect. We are likely to be dissatisfied if our friends and neighbors have far more than we do.
That doesn't mean you shouldn't bite the bullet and retire at a lower standard of living. But before you say goodbye to your regular paycheck, make absolutely sure you will be content with your reduced income
如何弥合退休生活的收支差距
退休也许离我们并不遥远。
的确，如果你想安度晚年，享受豪华度假，每天都在外面欢宴，那么退休生活将会十分破费，你可能需要为多年的退休生活攒上一大笔钱。不过，如果你对自己的退休梦可以变通的话又如何呢？那样你可能比想像中更接近梦想。
收入不够
当你估算自己潜在的退休收入时，你可能会考虑以下3个主要来源：社会保障基金，传统的“定额给付”退休金计划，以及你自己的退休积蓄。
假设你没有退休金，但你可以每年从社会保障基金申领15,000美元。与此同时，你自己的个人退休帐户、401(k)计划以及通常的课税帐户中有总额20万美元的存款。我们假设每年你打算支取自己投资组合年初价值的5%。
这种支取策略在我看来相当节俭，开始你可以由此获得10,000美元的税前退休收入，随后的年份有望增加。记住，如果你以现金获得股息和利息，你应当把这笔投资收益算进投资组合5%的支取率当中。
加起来，你每年的退休收入预计可达25,000美元。假设你的目标是45,000美元。你面临的挑战是：以某种方式弥补两者的差距。
搬家
如果你居住在东海岸或者西海岸的某个大城市里或者附近，我肯定你会有和我刚才一样的想法。为什么不以如今令人瞠目的价格卖掉现在的房子，然后搬到一个住房市场不那么华而不实、你有可能以半价买到一处不错的住房的地方呢？
这样做不仅能给你带来额外的现金补充退休收入，而且你也可能因此削减开支。
黑贝勒(Henry 'Bud' Hebeler)运营著一个专门研究解决退休问题的网站
www.analyzenow.com。他说，他的姐夫在阿拉巴马州亨茨维尔退休了。那里的生活成本要低得多。水电费要低一点，房地产要便宜一些，地产税要低一些，印花税也不那么高。
迁往另外一个地方可能不是个好主意，因为你有可能远离朋友和父母。但堪萨斯州密辛的咨询公司Garrett Planning Network的创始人加勒特(Sheryl Garrett)说，这种变化不一定非要那么急剧。Garrett旗下有240位理财专家，他们按小时收取咨询费。
她说，如果你住在大城市里或者附近，你或许可以搬到一个小时或者90分钟车程之外的地方找一个更便宜的住处，从而降低生活成本。
加勒特问道，“现实是，如果你所有的财富都被套在住房上，那你还怎么退休？”“你可以进行反向抵押贷款。但这是最后的办法。在此之前，我会考虑削减成本。”为此，你应当浏览
www.bestplaces.net、
www.homefair.com和
www.relocationessentials.com等网站，查阅其他地区的生活成本。
假设你把目前价值30万美元的住宅换成一处15万美元的住宅。这将释放出15万美元的房屋权益，你可以把这笔钱加入自己的投资组合，从而将养老储蓄提高至35万美元。
假设支取率为5%，现在你每年的投资组合收入可达17,500美元。加上从社会保障基金领取的15,000美元，你每年的退休收入可达32,500美元。
兼职工作
即便是32,500美元，它与你45,000美元的目标还是相去甚远。为了弥补差值，你可能要在退休期间兼职工作。黑贝勒说，越来越多的人这样做。通常，他们每周工作一天。他们需要额外的收入。
在早些时候的文章中，我曾经提到过退休期间工作的可能性。我收到了对此很是感到不屑的读者邮件。他们的观点是：任何还在工作的人都没有真正地退休。我的直觉是：这种态度会发生转变－－有两个理由。
首先，研究已经发现，退休期间工作的老年人通常会感到更加快乐。加勒特说，“这远不只是收入的问题。”“我们需要参与到工作中，受到激励。”
其次，赚一点钱可以让退休生活更加容易负担。
假设你每年挣5,000美元，你的退休收入将因此小幅上升至37,500美元。根据5%的支取率，这5,000美元的收入就像是10万美元的额外退休储蓄。
确实，你可能会在退休期间继续全职工作，并最终在无需额外收入的情况下彻底退休，而不是一边退休、一边还兼职工作。但在走上这条路之前，想一想你需要全职工作多少年才能攒下额外的10万美元。有鉴于此，也许一点兼职工作看起来并不那么糟糕。
削减开支
在我们的例子中，你仍然没有达到45,000美元的退休收入目标。为了缩小差距，你可能会利用部分投资组合购买即期年金，或者对你新购置的住宅进行反向抵押贷款，以此从你的资产中挤出更多的收入。
但同时也考虑一下你是否可以设法减少开支，尤其是如果你打算搬到更便宜的地方居住的话。显然，你希望有足够的收入支付基本开支，包括医疗费、地产税、偶尔的大笔费用，如更换汽车，或者为住房换置新屋顶。
不过，对我们中的大多数人而言，“足够”的定义不仅限于此。在一定程度上，是因为我们希望有钱在退休期间旅游，或者追求新的爱好。但同时，“足够”也不是一个固定的金额。
相反，研究显示，谈到财务上的满足感的问题，相对收入和财富也同样重要。如果我们的退休收入远远低于我们过去的薪水，我们可能不会感到高兴。如果朋友和邻居的退休收入远远高于我们，我们也会感到不满意。
这并不意味著你不需要咬紧牙关，以较低的生活成本退休。不过，在跟你通常的薪水说再见之前，一定要确保你会对降低后的收入感到满足。
