Long-Term Planning: Keeping Your Eye On The Prize
There is a witticism that goes something like “experience is something that you get just after you need it” and this is certainly the case in many instances. There are times when you find yourself in this type of situation when you still have time to overcome whatever challenges that lack of experience may have caused. But when you fail to construct a long-term plan and stick to it over the years you may find that it is too late to overcome your lack of foresight.
Time can pass extremely rapidly and you may find yourself celebrating your 50th birthday without having ever seriously considered the specifics of how you will be financing your retirement years. This is a difficult situation to be in because when you look at the statistics people are living longer than ever; once you reach the age of 65 the odds are even money that you will live beyond the age of 85. It takes very focused long-term planning to be prepared for this type of longevity.
A lot of people think that Social Security and Medicare will take care of most of their needs, and this may be true to some extent. But according to the Boston College Center for Retirement Research the average American senior citizen will incur around $197,000 in out-of-pocket medical expenses during the course of his or her life. Obviously the longer you live the large this number is likely to be. If you include the possibility of long-term care as well the typical individual could expect expenses that could exceed $500,000.
The statistics would indicate that the sooner you implement a long-term plan with these anticipated costs as your guide the better. People who have their retirement years in mind when they’re in their 30s and 40s generally find themselves fully prepared, and those who do not often wind up understanding how important it is to plan ahead after it is too late to do so.
