2 Things Boomers Shouldn’t Worry About in Retirement and 2 Things They Should
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Retirement is often sold as a time when most of your cares ebb away now that you have time to enjoy leisure, relaxation and put down the burdens of working as hard as you did for many years.
However, for many boomers, new worries crop up, such as how to stretch a more limited income, health concerns and more. It’s also easy to be anxious about things going on in the world that might affect the economy, Social Security or Medicare.
Christopher Stroup, CFP and owner of Silicon Beach Financial, offered retired boomers some insight on things they should not worry about in retirement and several they should.
Don’t Worry About the Stock Market
If you’re losing sleep about ups and downs in the stock market, Stroup suggested you redirect your anxiety.
“How the stock market behaves on any given day, month or year is totally out of our control,” he pointed out.
What is fairly predictable, however, is that the stock market regularly experiences a bear market once out of every five years, he said. This means that over a 20- to 30-year retirement, you can expect to navigate at least four to six bear markets, he explained.
While most retirees will most likely need to participate in the stock market to some degree in order to ensure that they don’t outlive their assets, it shouldn’t be a cause of you losing sleep.
“Even though market volatility can be scary, especially when living on a fixed income, it’s an integral aspect to securing the growth that the stock market has delivered to long-term investors.”
So long as your investments are well diversified, and you have planned for your stage of life, you shouldn’t see any major negative effects of stock market changes (barring a true economic crash).
Don’t Worry About a Reduction in Your Social Security Benefits
In the build up to an election year, the issue of Social Security always comes up in the political conversation, which can naturally cause anxiety.
“There’s been a lot of press about Social Security running out of funds in the next decade or so such that Social Security benefits may be nonexistent for future generations,” Stroup said.
However, rather than worry about cuts, Stroup assured that boomers should “fully expect to receive their full Social Security benefits.”
Even if the Social Security Administration is on the verge of running out of funds, expect elected officials to step in to save this program, he said. Social Security is one of the few programs that is still popular on both sides of the political aisle.
Do Worry About Your Health
If you want to pick an area to worry about in retirement, Stroup said, focus on your health.
“I’ve witnessed too many people spend decades saving for their retirement to build a sizable nest egg only to have their health sidestep their ability to leverage it,” he said.
Not only is it important to have a financial plan for retirement, but it’s equally important to plan for your mental and physical health during this chapter of life, Stroup insisted.
“This means finding community, participating in hobbies that keep you active [and] focusing on your mental health, among other things. Your health is the ultimate wealth during this season of life.”
Do Worry About Inflation
If there’s one thing you should be concerned about (again, not as in losing sleep, but in planning), it’s inflation, which Stroup called, “the silent headwind that can eat away at someone’s retirement assets.”
Inflation is a given, and while The Federal Reserve board works to try and keep it at or around 2%, as the COVID-19 pandemic proved, sometimes it can skyrocket.
It’s important that you have a plan to combat inflation during retirement, which is something a financial advisor can help you develop.
“The best way to beat inflation is to invest in assets that typically outpace inflation, such as stocks, fixed income and real estate. To ensure that idle cash is keeping up with or beating inflation, look at opening a high-yield savings account or consider a CD ladder.”
If you’re not yet retired, the best way to prevent any financial anxiety is through careful planning.
More From GOBankingRates
