The Background To The Need For Retirement Planning 

By Ron Iverson, Copyright 2007 

In the next few weeks we will take a look at some actual retirement misconceptions from both the recent past and the present:  And, as sad as it is, we will find several examples of problems which have surfaced, after people had assumed that a comfortable retirement was a guaranteed part of the great American scheme of life.  In short, a comfortable retirement is achievable-with proper planning-but it is not guaranteed.

From all indications, the problems will get worse.  Americans don't, haven't, or can't, save enough.  Pension problems, a continuation of skyrocketing medical, long term care and prescription drug costs, inflationary erosion of the current dollar, tax obligations of several kinds, and inflation in normal living expenses, seem to be pretty well entrenched as obstacles to the normal retiree's future.

Even though Medicare and Social Security will survive the onslaught of 76 million baby boomers "piling on," how the benefits are delivered as compared to today's promises, make these two important retirement institutions somewhat of a moving targed.  For years, politicians have been warned that some adjustments need to be made, but "the third rail" of politics--the one that stings--continues to be ignored by Washington.
  
In addition, huge demographic problems caused by 76 million (give or take a few villages), of your friends and neighbors joining you in your retirement years, will exacerbate even more problems of an unusually new and never-before-seen nature.    

We have one basic demographic problem-extended longevity. We can do nothing about this scenario-extended longevity-the wheels are locked in, and the final approach is underway.  In the past, we simply referred to the word "longevity."  Not anymore.  We now have "extended longevity."  It's here to stay. 

Every decade of America's existence has seen the life expectancy of it's citizens rise, and we now have a "bubble of boomers" being followed by too few workers-in fact, two workers for every one recipient on Social Security and Medicare sometime in the first third of the century. 

This bubble has even caused the Census Bureau to predict that by 2050, we will have more than one million people over the age of 100 in our country.  Seems impossible, doesn't it?  Think of it this way-if you're 60 today-you may well live to be 100!  Happy birthday!  And pass the aspirin, please, we've got some kind of headache.