financialsense.com / FS STAFF / 01/26/2017
Retirement planners often assume rates of return on clients’ portfolios between 6 and 7 percent right now. This time on Financial Sense Lifetime Income Series, we look at why this isn’t likely in our present situation, and what investors can do to protect themselves.
Retirees Face Difficult Challenges
We’re beginning to see the largest generation in US history start to retire and the next 20 years are likely to be high risk for Baby Boomers.
“There are $10 trillion in retirement assets and, in the next decade, 60 million boomers age 70 and a half will have to draw from those IRA and 401(k) accounts,” said Jim Puplava, founder and president of PFS Group.
This is significant because Boomers are entering retirement during a period of the lowest returns for both stocks and bonds that they’re likely to see in their lifetimes.
Couple that with the fact that life expectancy is going up, and Boomers may face the prospect of living longer with lower income.