Does the 4% rule still apply?

Life expectancy is a big unknown for people who are thinking about retiring. So here is life expectancy for those who are 65 in some countries from around the world.

Country	U. S. A	Canada	U.K.	Australia	France
Men’s Year	17.1	18.8	18.8	18.8	23
Women’s Years	20.7	23.7	22.7	23.7	27.2

The figures above are important for the millions of people facing the tough decision about how to string out their limited savings for a retirement that, on average, should last depending where you live between 17.1 years and 23 years for a male taking a pension at 65, and between 20.7 and 27.2 years for a woman.

In the above countries, there is a multi-pronged approach to pensions, with the government pitching in some money, but the bulk of retirement income has to come from the individual, either through investments encouraged by the government as in Canada through Registered Retirement Savings Plans and in the US through programs such as the 401 K.

The issue for a person approaching retirement is how soon will I run out of my money (we are assuming that some money has been saved). The old formula of taking out 4% a year is not a hard and fast rule anymore. A British investment company took a look at someone who retired at age 65 with 100,000 in savings. They then looked at how long the money would last if the person took out 5%, 6% or 7%.

The results were not too surprising. The money lasted longer withdrawing 5% than it did if 7% were withdrawn. At 5% withdrawal a year the money would last over 25 years but if you withdrew 7% your money would be gone in 14 years.

Longevity is the wildcard, for many as it is unpredictable. I can, I suggest, safely assume that I as a man will live 18 years if I continue to stay in good health at age 65, but there are no guarantees. That is a problem when looking at how much can I afford to take out of my savings per year when I retire.

The investment company suggests that in many ways the best option for would have been to accept a lower income at first, but invest the money in equity income funds. These produce an income that, if all goes well, increases over time. The firm says that someone taking this option would have received an income of just $2,052 in the first year, growing to $4,146 over time. Just as importantly, the money would not have any risk of running out it would have grown with luck and the right market.

Annuities are another option. If I invest $100,000 in a single life level my income would be about $7,100 a year, I would receive that until I died. So, the longer I live the more I get out of the Annuity. By buying an annuity I give myself a guaranteed annual income, which may be more over time than if I kept the money in equities and withdrew 7% a year.

We do not a crystal ball that will tell us how long we will live so we have to take our best guess based on family history, and lifestyle. Once we make our best guess then we will be able to decide how we want to take our money out of whatever saving program in which we have our retirement funds. 

The body of evidence on reducing your risk of dementia

The following is an article from Cornell University evidence-based-learning portal. As the world population ages, dementia is expected to affect more people than ever before — more than 65 million people worldwide by 2030. One of the first symptoms of dementia and Alzheimer’s disease is cognitive decline: forgetting words and names, losing items and struggling with planning and organizing.

There is a growing body of evidence that identifies some factors that reduce the risk of dementia and cognitive decline later in life. The data are summarized in a recent issue of the Journal of the American Medical Association.

The article points to a systematic review of 247 studies published in 2014. The review found four factors that increase the risk of dementia later in life.

1.   High levels of the amino acid homocysteine in the bloodstream. High homocysteine levels are associated with low levels of vitamin B6, B12, and folate and increased risk for heart and renal disease. Studies have found that homocysteine levels can be lowered by consuming folic acid and vitamin B-12, which are found in citrus fruits, tomatoes, vegetables, and whole grains.

2.  A lower educational attainment is associated with an increased risk of cognitive decline. Researchers hypothesize that your brain is like a muscle, and using it more will make it stronger.

3.  Smoking or any history of smoking increases the risk of developing dementia later in life.

4.  A sedentary lifestyle increases the risks of dementia and cognitive declines.

The take-home message? There is a lot we don’t know about cognitive decline and dementia. But there is evidence that you can take some steps to improve your cognitive health later in life.

Walking

Research, of the Cancer Prevention Study-3 for the American Cancer Society (ACS), focuses on the most common and accessible form of physical activity: walking.

Almost 27 percent of people aged 65 to 74 and over a quarter of the population aged 50 to 64 said that they are inactive, according to a survey recently carried out by the Centers for Disease Control and Prevention (CDC.)

 Regular physical activity is essential for healthy aging. Adults ages 65 years and older gain substantial health benefits from regular physical activity, and these benefits continue to occur throughout their lives.

Promoting physical activity for older adults is especially important because this population is the least physically active of any age group.

Some physical activity is better than none, and a new study further strengthens this message. The study found that even levels of walking that do not meet the national recommendations still lower the risk of premature death by a considerable amount.

In another study, 140,000 people took part in the Cancer Prevention Study II Nutrition Cohort. Of the participants, 6–7 percent said that they did not take part in any moderate or vigorous physical activity at the beginning of the study.

As many as 95 percent of the remaining participants said that they did some walking, and for almost half of them, walking was the only type of moderate to vigorous physical activity they engaged in.

The team adjusted for other risk factors that might have influenced the results, such as obesity, smoking, and chronic illnesses.

The study revealed that, compared with no physical activity at all, as little as under 2 weekly hours of walking correlated with a lower risk of all-cause mortality.

Additionally, meeting or exceeding the national guidelines, which is 30 minutes a day for physical activity by twofold through walking alone was linked with a 20 percent decrease in mortality risk.

Walking seemed to do the most good for preventing respiratory disease-related mortality. More specifically, more than 6 hours of weekly walking was associated with a 35 percent lower risk in this type of mortality, compared with those who were the least physically active. Other findings were:

·        Regular physical activity reduces the risk of many adverse health outcomes.

·        Some physical activity is better than none.

·        For most health outcomes, additional benefits occur as the amount of physical activity increases through higher intensity, greater frequency, and/or longer duration.

·        Most health benefits occur with at least 150 minutes a week of moderate-intensity physical activity, such as brisk walking. Additional benefits occur with more physical activity.

·        Both aerobic (endurance) and muscle-strengthening (resistance) physical activity are beneficial.

·        Health benefits occur for children and adolescents, young and middle-aged adults, older adults, and those in every studied racial and ethnic group.

·        The health benefits of physical activity occur for people with disabilities.

·        The benefits of physical activity far outweigh the possibility of adverse outcomes.

Cardiovascular mortality was also lower among those whose only form of physical activity was walking. These people were 20 percent less likely to die from a cardiovascular illness and 9 percent less likely to die of cancer.

Walking has been described as the 'perfect exercise' because it is simple, free, convenient, doesn't require any special equipment or training, and can be done at any age. If you are going to begin a fitness program always check with your doctor. Here are some guidelines to help you

Avoid Inactivity
Some physical activity is better than none — and any amount has health benefits.

Do Aerobic Activity
For substantial health benefits, do one of the following:

•    150 minutes (2 hours and 30 minutes) each week of moderate-intensity aerobic physical activity (such as brisk walking or gardening)
•     75 minutes (1 hour and 15 minutes) each week of vigorous-intensity aerobic physical activity (such as jogging or swimming laps)
•     An equivalent combination of moderate- and vigorous-intensity aerobic physical activity
•     Do the aerobic physical activity in episodes of at least 10 minutes and, if possible, spread it out through the week.

For even greater health benefits, do one of the following:

•     Increase moderate-intensity aerobic physical activity to 300 minutes (5 hours) each week
•     Increase vigorous-intensity aerobic activity for 150 minutes (2 hours and 30 minutes) each week
•     Doing more will lead to even greater health benefits.

• When older adults cannot do 150 minutes of moderate-intensity aerobic activity a week because of chronic conditions, they should be as physically active as their abilities and conditions allow
• Older adults should do exercises that maintain or improve balance if they are at risk of falling
• Older adults should determine their level of effort for physical activity relative to their level of fitness
• Older adults with chronic conditions should understand whether and how their conditions affect their ability to do regular physical activity safely

Strengthen Muscles

Do muscle-strengthening activities (such as lifting weights or using resistance bands) that are moderate or high intensity and involve all major muscle groups on 2 or more days a week

MERRY CHRISTMAS AND HAPPY HOLIDAYS

FROM MY  FAMILY TO YOU AND YOURS ENJOY CHRISTMAS DAY AND THE HOLIDAY!