Lori and Marek Fuchs have never fought in their 16 years of marriage—except over money. In this column, Mr. and Mrs. Fuchs, a real-life married couple with three kids (ages 12, 7 and 5), articulate their very different approaches to personal finance.
This round the Fuchs mull just how long "til death do us part" actually means.
Mrs. Fuchs: You know that joke I always make about you having to work until you are 80?
Mr. Fuchs: Yes, it’s not so funny.
Mrs. Fuchs: Well, I just read an article that said with medical advances, life expectancy is rising rapidly. Do you think our plan for retirement takes that into account? I’d hate you to have to apply for jobs when you are 95!
Mr. Fuchs: Now you’re killing me.
Mrs. Fuchs: Seriously, when people used to think about saving for retirement, it was for a limited amount of time. You retired at, say, 65 and died a few years later. Now, eat lots of vegetables and walk 10,000 steps a day and you can live to 100.
Mr. Fuchs: I personally don’t even plan on dying. But how do you plan for a retirement that long and who do you talk to about how many total years you should save for: a financial planner, a doctor or a priest? How do you know how long you are going to live? It could be 100, or you might get hit by a bus at 65.
Mrs. Fuchs: Look both ways.
Mr. Fuchs: I even look up to make sure nothing is going to fall on me, but who knows how long we are going to live? What a financial, genetic crapshoot, huh? Where do you start? We have young readers like 26-year-old Anthony Nugnes, who lives in the DC area, and is expecting to live to about 80. But considering drug technology, that dude might make it to 140…
Mrs. Fuchs: If he looks before he crosses…
Mr. Fuchs: Right, but Anthony wants to stop day-to-day work by 50 and my friend Michael Lombardi, who worked in finance for decades, points out that if you spend a lot and want to pay for your own funeral, you might have to keep working until shortly after your death.
Mrs. Fuchs: Doesn’t it also depend on what kind of job you have and what the benefits offer? My parents were able to retire early with great pensions until the day they die, but we’re both self-employed – how do we figure it out?
Mr. Fuchs: Yeah, your parents were teachers. In terms of lifelong pensions, they are essentially "The Last of the Mohicans." For the rest of us, it’s the most important guessing game we’ll ever play.
Here's what Scot Stark, CFP and head of Stark Capital Management in Freeland, Md. says about it all: “I usually quip with folks that if they can tell me exactly the day they’ll die and how much they’ll spend to the penny during retirement, then I can probably make their last check bounce!”
Once he stops telling death knee slappers, Stark says you can talk to a doctor, but unless you have a serious condition, you still won’t get an answer you can even vaguely rely on. Instead, “while planning for the income distribution phase of your retirement, I’d almost never use an age under 90, preferably not one under 95. Then, if you have more money than you have life, so be it. But, if you have more life than you have money, then what?”
Mrs. Fuchs: It seems so morbid to actually try to predict how long you’ll live. Maybe the better approach is to stick to our budget and keep socking the money away. That way we won’t have to suck up to the kids, or even the grandkids, to keep us from a diet of cat food at the end.
Mr. Fuchs: Well, it is a dark art. And you are right about how we should just keep socking money away. But we should have a minimum age we are expecting to reach. And, everything considered, we should assume we’ll make it to be pretty long in the tooth. When it comes to saving and considering a retirement date, let’s figure that we’re going to live until 95.
Mrs. Fuchs: Why not an even 100?
Mr. Fuchs: Why not? We can boogie the 2070s away together.
Mrs. Fuchs: If you have the time. Remember, I might still have you working.
Other Great Mate Debates:
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