Rick was named the #1 Illinois elder law estate planning attorney by Leading Lawyer Magazine. He has been quoted in the Wall Street Journal, AARP Magazine, TheStreet.com, and numerous newspapers and articles. Rick is the lead attorney for Law Elder Law, LLP, focusing in Estate Planning, Guardianship, and Nursing Home Solutions. His goal is to give retirees an informed edge when it comes to dealing with an uncertain future. Get flexible retirement strategies that work during good times and bad, plus information on how you can save your home and assets from being used to pay for long term care. Appointments available in Chicago, Aurora, Oak Brook, Schaumburg, and Joliet. Call 800-310-3100 for your free consultation now!
By Rick Law, Elder Care Attorney in Illinois.
Yesterday’s investment rules and outcomes don’t apply in today’s retirement landscape.
In light of the current economic earthquake, many people are shell-shocked and immobilized by fear. To quote a client:
“We’ve got an income crisis. It wasn’t supposed to be like this. We played by the rules. I thought we did everything right. I worked hard to save and invest so Betty and I would have enough to comfortably live off our income. But now we’re spending our principal to just to stay afloat. I don’t know how this could have happened. They must have changed the rules.”
This man had a successful career as an administrative executive. He and his wife are both 67 years old. They’re careful, frugal and conservative. He’s an analytical type who researched their investments and created a model diversified portfolio with a balance of stocks and bonds. Investments were all supposed to work to generate an average return of 11 percent per year, as based on long-term historical results. Had history repeated itself, that return would have been more than sufficient to fund their lifestyle and still maintain their portfolio’s principal value.
But their well-laid plans blew up! Their savings were devastated by the technology bubble meltdown, followed by a sideways stock market, the world financial system crash, and finally governmental policies that have created zero-interest returns on safe investments.
The supposedly right answers about how to provide for a successful retirement just don’t seem to work anymore. Senior investors are searching for the new right answers to protect their lifestyle. They don’t have the luxury of looking back for the right answers—they’re pioneers, a group of retirees like the world has never seen before.
Never in the history of human existence have millions of people had the probability of living to be more than 85 years of age. That’s right, today the average life expectancy of the U.S. citizen has increased to 78.2 years, and millions of people will exceed that life expectancy by a decade or more. When thinking about the joint life expectancy of a husband and wife, really old age becomes almost a certainty. The longevity statistics for a healthy couple, both age 65, indicate that at least one will live to be over 90 years of age. (And at least one will most likely spend two and a half to three years in a nursing home.)
Just to emphasize how fundamentally different the retiree universe is today, there are now two full generations of retirees alive: the baby boomers and their parents, the “greatest generation.”
In the coming days we’ll look at some important topics such as just how much things have changed, How we as elder law attorneys can help, and the necessity of knowing what you have and how much you’ll need to live out your golden years with dignity.
Too many families needlessly lose everything they have. Don’t let that be you. If you need help paying the overwhelming cost of long term care, give our office a call at 800-310-3100. Your first consultation is absolutely free. We’ll let you know what steps you need to take, right now, to protect yourself and your family. Call now, because when you’re out of money, you’re out of options!
Rick L. Law, Attorney, Estate Planner for Retirees.