UNCOMMON CENTS 67

WHAT TO DO? IN THE AGE GROUP 55-64 OF PROSPECTIVE RETIREES, THE HEAD OF THE TYPICAL HOUSEHOLD HAS LESS THAN $90,000 IN SAVINGS. HOW CAN ONE SURVIVE RETIREMENT THIS WAY? FINANCIAL ADVISERS RECOMMEND THAT 3 OR 4% A YEAR FROM EACH $100,000 WITHDRAWN FROM AN INVESTMENT PORTFOLIO, THAT IS, $4000, GUARANTEES YOU AN INCOME, BUT WHERE WILL THE 2ND $100,000 COME FROM? EXPERTS ALSO EXPLAIN THAT FROM RETIREMENT TO AGE 85, A PERIOD OF 20 YEARS, 1/20TH OF YOUR PORTFOLIO (SAVINGS OR INVESTMENTS) WILL TIDE YOU OVER. BUT WHERE IS THE PORTFOLIO IN THE FIRST PLACE? IF YOUR RETIREMENT LASTS 40 YEARS, 1/40TH WILL BE NECESSARY TO DO THE JOB, BUT HOW CAN YOU DO THE SIMPLE DIVISION IF NO PORTFOLIO ALLOWS YOU TO DO SO? ANALYSTS FURTHER SUGGEST A SIMPLE, INCOME ANNUITY FOR RETIREES WHICH MEANS THAT AFTER TURNING OVER A LUMP SUM TO AN INVESTMENT ENTITY, IT IN TURN DISTRIBUTES A SET PERCENTAGE OF THE MONEY TO YOU OVER TIME OR RE-INVESTS IT BACK INTO YOUR CAPITAL. THE CATCH IS THAT THE 'LUMP SUM' MUST EXIST, MUST BE A SUBSTANTIAL, SAY $10,000.

WHAT TO DO? TYPICALLY, HEADS OF HOUSEHOLD HAVE LESS THAN $90,000 IN SAVINGS BY AGE 55 TO 64 WHEN RETIREMENT LOOMS. BABY BOOMERS WHO ARE NEARING RETIREMENT, BEWARE! YOUNG WORKERS WHO HAVE A FUTURE TO FUND, BEWARE! IGNORE ANY APPEALING BUT ILLOGICAL SOUND BITE FROM FINANCIAL CONSULTANTS. ONE SUCH SILLY QUIP, "KEEP OFF THE POUNDS BECAUSE IT IS AS IMPORTANT AS INCREASING DOLLARS IN YOUR INVESTMENT PORTFOLIOS" IS MERELY DESIGNED TO LINE THE POCKETS OF THE FINANCIAL PLANNERS. SUCH NONSENSE WILL NOT KEEP POUNDS OFF YOUR WAISTLINE AS IT ADDS MONEY INTO YOUR PORTFOLIO. ONLY COMMON SENSE AND A CONSISTENT APPROACH TO EATING AND INVESTING WILL REAP LONG-TERM HEALTH AND WEALTH REWARDS.

HINT: DON'T POUND THE PAVEMENT AT MARATHONS. POUND OUT A REASONABLE BUDGET AND STAY WITHIN YOUR MEANS. THE STARTING LINE FORMS NOW.