The #1 Fear of Retirees

Running out of money remains a big fear of the currently retired as well as the millions of Baby Boomers close to retirement. This fear seems to have little bearing on how much money someone has. The wealthier seem to fear running out as much as those who truly do have a reason to be concerned. Uncertainty about the future has never been more real.



The biggest cause of this fear is uncertainty about how to invest and the unknown about future returns on investments. The past decade of market volatility has robbed the 401ks, IRAs and personal savings of the much needed funding for a secure retirement. Many have come to face the harsh reality that what they believed to be true about investing has turned out not to be true. That is, the old “buy and hold” approach has turned out to disappoint many who found little or no growth on their money over the past decade.


The issue at hand is more than just adequate account balances. Financial security must be considered from an emotional viewpoint before and after retirement. While working, the sense of financial security comes from having a job and a paycheck. Once retired, that sense of security changes dramatically. It now becomes the reality that your financial security comes from how much money you have saved.


Resolving this fear of running out of money starts with selecting an advisor who understands both the practical and emotional risks of retirement. This advisor must be experienced in working with retirees. Most financial advisors have a focus in helping their clients accumulate their money. The expertise in managing a client’s savings once retired is distinctly different. All too often, a trusted advisor who helped a client accumulate their retirement funds does not have the training or expertise to make the appropriate changes in strategy to protect those funds against the risk of longevity.


Just as in the area of medicine and your health, getting a second opinion before making an important decision is always beneficial. That opinion may confirm that you are on the right track and thus your peace of mind is secured. Or, you may need to face the reality that what worked to get you to this point, will not be the same plan for your future. Either way, a second opinion is usually well worth the time and effort.