In her role as Director of Financial Planning for Morningstar, Sue Stevens recently penned a noteworthy article, "How to Manage Risk in Retirement." While retirees face many types of risk, she focuses on two: longevity risk and spending risk. The threat of outliving one's assets is illustrated by the following statistics: "For a couple aged 65 and about to retire, there is a 50% chance that one of them will live to age 91 and a 25% chance that at least one of them will live to age 96." Stevens also cautions about overspending in light of retirees' active lifestyles and accelerating health care costs, including potential nursing home care. The article provides not only cautionary warnings, but practical advice to provide protection from these financial threats. The article is available by clicking here.
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