Retirement - It's Not a Black Hole

If you and your life partner are in your mid-50's orthat a return hovering around 4% was lackluster. But
beyond, you've begun to think in earnest aboutthe wake up call has been heard, and investors once
retirement. What you contemplated fuzzily (or not atcharmed by stocks that rose precipitously are
all) in previous decades looms suddenly in sharpsticking their cash into instruments with modest
focus, and it's not a rosy picture.return but greater safety. Financial advisers agree to
No one has been entirely immune to the mostsome extent with the flight to safety. They
significant financial turbulence of our time (torecognize that some investors have no stomach for
remember life during the Great Depression, you'llvolatility. Nevertheless, they caution investors to stay
have to be in your 90's). IRAs and 401Ks are moreliquid enough to be able to jump in when the market
anemic than anyone had imagined, and staring grimlyreturns to equilibrium. At that time, conservative,
at your computer screen has not returned yourincome-generating investments will be the right place
stock portfolio to its former state. Manyfor retirees or those almost ready to retire.
baby-boomers already know they'll be working a fewBoomers can expect to live much longer than did
years longer than they'd planned. You might want toprevious generations. This is good news and bad
do this, too if it's a reasonable and available option.news. Being healthy at 90 is fortunate only if the
You'll not only be maintaining your income level, you'llmoney hasn't run out. Worries about depleting the
be adding to your IRA or 401(k), maintaining yournest egg are the stuff of many nightmares even
health benefits, perhaps increasing your pension, andthough, according to what financial advisers are
delaying Social Security payouts until later, whensaying, most retirees and would-be retirees are in
they'll be more substantial. Remaining longer in thebetter financial shape than they think. Social security,
workplace has mental health benefits as well.Medicare, pensions, interest on investments, drawing
But even with a decision to remain longer in thedown from IRAs and savings will get most retirees
workforce, some fear remains. One in fivethrough without being dependent on others.
respondents in a 2008 poll of retired people said theyFear of being dependent on others is especially acute
had stopped or reduced their 410(k) contributions.for Boomers, for whom independence is a mantra.
Many workers nearing retirement age have bailed outIronically, a certain kind of dependency may be the
of the stock market, unable to handle the volatility.best route to the independence Boomers so crave. If
Confidence is waning that 410(k) plans will providethe recent loss of assets makes you less confident
what is needed when it is needed.about enjoying a comfortable retirement, seek the
During the boom years, investing in CDs seemedadvice of your financial adviser.
almost irresponsible. Such large gains were possible