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business & professional

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Are We Old?

I

was having dinner with a friend of
mine who is an attorney that defends
municipalities. He was telling me
about a deposition he had taken that day
of a man that was suing his client (a town-
ship), alleging he was the victim of police
abuse in the jail.
In the course of
the deposition, the
witness indicated
he was more
scared for his
father (apparently
a great father-
and-son team)
because he was
"really old:' My
friend could not
resist asking the
fatal question, "So
how old is your
father?" The reply, "He's 53."
At 59, my friend was prepared for
this shocking revelation! Well, one thing
for sure — this man's perception of age
leaves a lot of "very old" and "ancient"
people.
Is 53 and beyond "really old?" Is it
time to hang it up at 65? There was a
recent article in the Wall Street Journal
titled, "Americans Rip Up Retirement
Plans:' The article reported that two-
thirds of Americans between 45 and 60
say they plan to delay retirement plans,
up sharply from just two years ago when
only 42 percent were planning to delay
retirement.
Is this surprising? More important,
is this a good thing? I don't find it sur-
prising, and I think it is a good thing.
Medicine has extended our life expec-
tancies. We live longer and we spend
more. According to the Social Security
Administration, a man reaching 65
today can expect to live until age 83 and
a woman can expect to live to age 85.
About one of every four 65 year olds
today will live past 90 and one out of 10
will live past 95.

Worldwide, most babies born in 1900
did not live past age 50. So the witness my
friend deposed had a point, he was just
113 years behind the times. When I gradu-
ated high school in 1972, the average life
expectancy in the U.S. was 71.2. Today, it
is 78.
We could spend hours fretting over the
future of Social Security in the United
States, but one thing is certain, we have a

need to plan our finances for longer life
expectancies. If we are in our mid-50s
or 60s, we need to be pragmatic as to
whether we have laid a solid foundation to
retire that considers we'll be sitting around
complaining about the Lions and second-
guessing the Tigers manager when we're in
our 90s.
The financial crisis was a rude awaken-
ing for many people. Some of us suffered

significant setbacks in income. Others
sustained a loss in savings when the stock
market fell apart and many moved funds
into cash or more conservative holdings
only to miss out on the stock market's
rebound. Far too many other people were
living on the edge — allowing themselves
a high standard of living predicated on
available credit lines rather than bona fide
savings for retirement or emergencies.
Whatever the story, when we started our
"adult years" in the 1970s, we expected
to only make it to our early 70s and now,
assuming we make it to 65, we're expected
to make it to around 84. To me, logic dic-
tates that a retirement timeline consistent
with our parents is not realistic. In 1970,
if we planned to retire between 62 and 65
(let's say 63.5) we were only expected to
live to 72. Today, if we expect to live to 84,
then the target date, proportionately, is 74.
Forget about fretting over Social Security
We need to realign our strategy and plan
accordingly. Stay healthy, exercise, embrace
technology (so you are not rendered obso-
lete by the youngsters) and knock 'em dead
— oops, let's go with "knock 'em out!"

❑

Ken Gross is an attorney with Thav Gross and
host of the Financial Crisis Talk Center show
that airs weekly at 8:30 a.m. Saturdays on
WDFN 1130 AM, "The Fan" and 1 p.m. Sunday

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February 21 • 2013

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