Summary |
Planning for retirement is one of those issues that can be summarized in the observation that here is both good news and bad news: the good news is that we are living longer, the bad news is that we have to pay for it. As we recover from the worst economic crisis since the 1930s –with large losses in pensions, income, and savings- we find that old adages like “stocks for the long run” and the safety of index and exchange traded funds have not worked to protect asset values.
Ensuring sufficient resources for retirement encompasses a complex set of decisions involving tax issues, assumptions on future salaries and potential loss with change of jobs, asset allocation for defined contributions pension plans, longevity, interest rates, inflation, and on retirement, whether to buy an annuity- all in the face of changing demographics and social factors. Each of these issues requires careful individual decision making in the face of increasing risk.
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