Tips to help you plan for retirement

A big question for those approaching retirement or those in retirement is how many more years are you going to live? It's not an idle question. Twenty-eight percent of Americans 50 and older underestimate their life expectancy by five years or more, according to a study by the Society of Actuaries. To find out how long you may have, check out the longevity at this link https://www.longevityillustrator.org/ Nearly a third of women significantly miscalculated their life expectancy.

You could argue that this is a good thing — so many more grandchild hugs! And it is, however, there is the fear that you could run out of money. One of the biggest money mistakes we make, is not understanding or underestimating your longevity. Life expectancy is the foundation of your planning

Finding the right target

In general, the older you become, the greater the likelihood that you'll reach your 90s. To get a fresh, relatively objective sense of your longevity, there is any number of tools available. Search online for “life-expectancy calculator” and you can get an estimate from several organizations. Some require answers to only a few questions; others take a deep dive into your eating habits, medical history and other matters.

Whatever number you end up with, the experts suggest that adding a few years to it to account for the wild card: medical advances that could keep you going even longer is not a bad idea.

Many happy returns

If you're just now turning 55, these are the probabilities that you'll celebrate other milestone birthdays.

Age     Men   Women

75       71%   81%

80       57%    69%

85       40%    53%

90       21%    33%

Once you have a better estimate of how long you expect to live, you can tweak your money plan.

Start saving to go the distance.

Use one or more retirement-income calculators to estimate if you're on track, based on factors such as your new longevity expectations, how much you've saved so far, your expected Social Security benefit and other guaranteed income, and your spending. There are many good web-based tools; just search online for retirement-income calculator. If your projections come up short, look for efficient ways to save more.

Look for ways to cut back.

Rather than give money to your family give the gift of your time The Pandemic has been hard on seniors and on their families. In a recent CreditCards.com poll, nearly 80 percent of parents who helped their adult kids financially during the pandemic said they gave money that they would have otherwise used to improve their own financial situation — to pay off debt, for example, or to save for emergencies and retirement. The average gift made during the Pandemic was $4,154. That's in line with other research that found that half of parents put their retirement savings on a back burner in order to help adult children.

Plan for health costs.

A few hours every week practicing yoga or lifting weights or walking could save you a bundle in the future and give you a better, more active retirement. Remember: Unexpected medical costs are one of the top financial challenges of retirement and these can be reduced by starting an exercise program to stay health.

Touch up your LinkedIn profile.

Planning for a longer life may mean working longer but it could also prompt you to find a new job that pays better and keeps you more engaged. Networking, both online and off-line, and keeping your skills fresh will help you stay on top of opportunities.

Another option is to explore a side gig, whether that's consulting, driving for a ride-hailing service or working at a golf course every other weekend. This work could bring in enough extra savings to put your plan on track and could even turn into an eventual retirement job.

Don't invest too conservatively.

In a recent survey 49 percent of people ages 45 to 67 didn't know how their retirement savings were invested. Respondents ages 45 to 59 who did know reported that only 30 percent of their money was in stocks and that nearly the same amount sat in cash. To build a retirement kitty, your returns need to outpace inflation; that generally means investing a larger portion of your money in stocks. It's important to look at your individual situation and talk to an independent Financial Advisor. If you have other sources of income, such as a pension or rental income, you may be able to keep less savings in stocks and still be secure for life.