
RETIREMENT MYTHS.
Don't Myth Retirement American Express thinks you need to re-think what you've always thought about retirement. And, in order to help you do just that, AE has released their list of the top retirement myths held by most Americans. •Social Security and Pension are enough for a comfortable retirement. Social Security and Pensions provide only 40% of retirement income. The remainder must come from personal savings, investments, and possibly a part-time job. •It takes a million dollars to retire comfortably. Your real needs will depend on your mix of investments, savings, part-time work, and other creative initiatives such as reverse mortgages to provide an income stream. •Family inheritance is a reliable source of income. It's risky to count on inheritance because unforeseen expenses (catastrophic illness, nursing home costs) could erode your parents money before it can be passed on to you. •There are ways to force the government to pay my medical bills. A new federal law now governs the time period in which people who are old and sick can "spend down" their assets in order to qualify for government assistance. The law imposes a fine of $25,000 for those who cheat. •Retirees are all in a lower tax bracket. Many retirees face additional taxes on income streams from work, capital gains, and stock dividends. •Retirement communities provide a lower cost of living. Do your homework on real estate values, property taxes, health care costs, and sales tax. Many cities grow into expensive communities. That sleepy little village where you vacationed every summer may attract many more retirees like yourself. That means growth. More city services, more homes, more schools, more roads. •Upon retirement my investment strategy should be conservative. This could be a mistake. A 20-25 year retirement life-span will require investments that provide a hedge against inflation. Also, shifting your investments may result in taxable capital gains. •Nursing home costs will be covered by Medicare. The majority of care provided in nursing homes is custodial, not medical care. Medicare does not pay for custodial care. And, if Medicare doesn't pay, then neither will most Medigap insurance policies. •Continuing to work will provide an income stream. Sometimes, even a part-time job can place you in a higher tax bracket. Your Social Security benefits could be reduced depending on how much income you earn, your age, and your filing status. Take time to discover the truth about these retirement myths, and your retirement income should last as long as you do. Reprinted by Permission From: AgeVenture News Service, Editor, Dr. David Demko, PhD http://www.demko.com[email protected] or [email protected] ![]()