As we have wrapped up the very successful Bigfoot Festival in Marion, I was thinking about how Bigfoot relates to retirement planning; both can be very elusive. When conducting a search you find that everyone has an opinion and with the introduction of the internet, there is a lot of information and misinformation out there. It can be frustrating when those who claim to have seen Bigfoot have difficulty producing documentation for the sightings. Similarly, those who claim to have a one size fits all retirement plan find it to be very difficult to deliver all they promise. Whether it is a Bigfoot sighting or retirement planning the goal is to rely on reliable, documented proof.
In my 26 years’ experience providing retirement planning education, analysis and consulting, I run into these challenges frequently. I don’t want to step into hot water, but like Bigfoot without documentation or retirement planning analysis, it is difficult to have confidence in either. A takeaway from my experience is that all planning must work on paper. I know without a doubt that if it does not work on paper it will not work in real life, regardless of how much we hope it will work. The second area of challenge is the internet. Just as in the case of Bigfoot, the internet allows anyone to make a claim with little or no documentation. I wish that some of these claims for both Bigfoot and retirement planning were true. Unfortunately, as your grandfather probably told you, “If it looks too good to be true, it is probably not true”. In our internet society everyone can be an expert and if you disagree you are frequently dismissed as not open minded or have just not studied the subject enough. This tactic has led many to lose some or all of their retirement savings. As a CERTIFIED FINANCIAL PLANNERTM practitioner I help people answer questions and provide a second opinion to many of these Bigfoot style promises.
At this point, it is important to realize that just like the claims of “perfect” options for retirement there are new products being developed every day. The rules for retirement saving change too. As tax brackets and laws change, we need to evaluate if our current saving strategy is still the best way to save. In the last 20 years, companies have changed from pension plans to matching dollar 401(k) plans to unmatched 401(k) plans. Some employers offer Roth 401(k) plans which may be a better long-term option for saving for retirement. Outside of these employer options, there are Life Insurance products that are very attractive. The challenge is that there is no consistent rule of thumb for any of these as each person is unique.
The last correlation of Bigfoot to Retirement Planning comes in the area of Long-Term Care. The use of this option for protecting your retirement seems as indefinable as Bigfoot. The statistics for Long-Term Care are staggering and about as scary as actually seeing Bigfoot in the woods. With over 50% of all Americans expected to have a long-term care event in their lifetime and less than 12% of people actually having a plan to pay for this need, it is clear that education is needed to address this shortfall. Unlike Bigfoot, Long-Term Care is easy to deal with. There are many options, and something is better than nothing. I would be happy to show you the options.