Goshen News, Goshen, IN

Z_CNHI News Service

October 28, 2013

The numbers you really need to know for retirement

If you are one of the 78 million Baby Boomers rolling into retirement in the next 20 years, you might want to sit down and do a little math. Retirement is a lot more complicated than it used to be.

So, before you quit your job and venture into the next stage of your life, stop for a minute to consider a set of numbers that could make the difference between retiring comfortably and well, not so much.

1. What is a reasonable estimate of your cost of living? This should be obvious, but most Americans dramatically underestimate their living expenses. Be honest and thorough. What do you pay for housing, including property taxes and insurance? What about utilities? And what about medical expenses or insurance premiums not covered by Medicare? What do you spend in a given month on restaurant dining and entertainment, or on the grandkids?

Whatever total figure you come up with, tack on an additional 25 percent. No matter how thorough you are, I promise you will forget something. The total you come up with here is the single most important figure. It’s the dollar amount you’ll need to generate from your portfolio investments and/or pension and from Social Security.

2. How much can you expect to receive from Social Security? According to the Social Security Administration, 53 percent of married couples and 74 percent of unmarried beneficiaries depend on Social Security for at least half of their income. A shocking 46 percent of unmarried beneficiaries rely on Social Security for 90 percent or more of their income. Social Security matters.

3. How much do your other investments need to earn to meet your retirement expenses? Take your expense estimates from above and subtract the after-tax Social Security payout from question two. Also subtract any other fixed income streams you expect, such as from a traditional pension or a trust. The amount left over is what you’ll need to generate from your investment portfolio. This number is critical because it will determine what type of returns you need to generate and what type of risk you can take.

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Poll

Three Goshen elementary schools — Chandler, Chamberlain and West Goshen — are providing free meals to all students during the school year as part of the U.S. Department of Agriculture’s Community Eligibility Provision of the Healthy Hunger-Free Kids Act of 2010. Nearly 80 percent of students at Chandler, 89 percent of students at Chamberlain and 78 percent of students at West Goshen already qualify for free or reduced-price lunches based on their family income. How do you feel about the new lunch program?

I think it’s a good idea to feed all the students free of charge
I think those who can afford it should pay for their school meals
I think all students should be required to pay for their school meals
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