We are living longer. That is a fact. But whether we need to work longer should be optional. The choice should be ours, and ours alone. For some people, however, working well into their old age could be unavoidable because they have not been able to put away enough money during their working lives that would allow them to retire.
That is troubling. What’s more, Larry Fink, the boss of Blackrock, has put the cat amongst the pigeons by suggesting that people could need to work beyond 65 years of age in order to retire comfortably. That might be true for a population as a whole. But whilst averages can be handy, they can also be misleading.
Let’s be clear about a couple of things. Fink is not wrong. But he is also promoting a new Blackrock target-date fund called LifePath. It could help many people close the retirement gap, which is how much money they need to fund their retirement compared to what they have already saved.
There are other ways that we can close the funding gap. We don’t always have to hand over our money to a financial institution to look after. We can easily do it ourselves. But to do so we need to answer three simple questions. They are: Where are we now? Where do we want to be? And how long it will take for us to get there?
If we can answer those three questions honestly, then we are more than halfway to closing the funding gap and be on our way to achieving our financial destiny. But we need to be totally honest. The only person we will be deceiving if we don’t, is ourselves.
There is something else to consider. Nobody has ever said that a retirement age of 65 has to be set in stone. We can choose to stop work anytime we want. But to do so, we need to be Salary Independent. It is a liberating concept….
…. But we need to appreciate that saving is just delayed spending. If we can curb our urge to spend today, we could have more to spend later. Find out how to do it here.
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