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SENIOR RESOURCES SENIOR RESOURCES

A MUST READ FOR

by Lowell Bridges Women

here is a lot of playing that goes on behind the walls 2. The accelerating demise of defined benefit pensions
of the Amarillo Senior Citizens Association, and (150,000 pension plans have been discontinued since
Tthis quote by George Bernard Shaw has become 1983, leaving 25,000 plans today, many of which plan
somewhat of a mantra to its members. to close within two years) – Source: Pension Benefit
Guaranty Corporation, Employee Benefits Research
In July 2008, Dr. David Babbel wrote a piece titled “Lifetime Institute, Mercer
Income for Women: A Financial Economist’s Perspective.”
He began with a story about a couple attending a sporting 3. The transition of the Baby Boomer generation into
event. Babbel found out that that the husband had been retirement (the first Boomers reached retirement
educated at a top American University. He enjoyed a very eligibility in 2006 and will continue a huge cash drain
successful career. Shortly before retirement, his company on our Social Security system) – Source: Social Security
changed from a defined benefit pension plan to a defined Administration
contribution plan. When he retired, he took a generous
lump sum settlement. His nephew convinced him to invest 4. Longer expected lifetimes (65-year-old women have
almost all of it into a promising new opportunity that the added another four years to their life expectancy since
nephew would personally manage. Well, as you could the 1960s) – Source: US Census Bureau
expect, things went south quickly, and they basically lost 5. The younger generations, who are being asked to
their entire retirement savings. To make things worse, his support Boomers’ unfunded benefits along with their
health began to fail. His wife, at age 66, had to get her first own healthcare and retirement needs. – Source: US
job! They had to remortgage their home. She hoped to be Census Bureau
able to retire at age 81—not quite the retirement of their
dreams. Okay, so we know the problems, but what are the
solutions? Dr. Babbel continued to say there are only three
Babbel went on to highlight FIVE overwhelming forces basic ways to invest your retirement money.
bearing down on women:
• First, you can annuitize a significant portion of your
1. Decreasing rates of return on their Social Security retirement savings, thus, ensuring you will have
contributions (averaging 1.8% per year for single income guaranteed for life. You must then invest the
women) – Source: Social Security Administration; rest of it in a diversified portfolio to help provide some
inflation protection.

• Secondly, you could invest in conservative fixed
interest investments like CDs or Government Bonds.
However, it will take a larger portion of your funds to
generate the same amount of income.

• The third way is to just “roll the dice” and invest
the entire amount in the stock market and hope you
don’t run out of money if it goes south while you are
Lowell Bridges withdrawing funds.
806.790.1625
2513 86th ST ste.A, Lubbock, TX 79423 AFC member 2023 For peace of mind in retirement, he believes option one is
the best solution since women will need more income due
www.seniorbenefitssolutionsofwesttexas.com to living longer than men in most cases.

Association of Financial Consultants (AFC) is an IRS-approved
501(c)(3) non-profit organization. AFC serves as an informational A special thanks to Tom Hegna, author and lecturer,
teaching resource for the general public. AFC member fiduciaries and for the contribution in his publication from "Retirement
consultants are committed to public service. We offer Educational Alpha, How Mortality Credits Improve Retirement
workshops and classes at no cost or obligation to the attendees.
Outcomes", 2019

36 Lubbock Senior Link