THE NO-COMPROMISE RETIREMENT PLAN • 23
It may surprise you to learn a healthy sixty-five-year-old cou- ple could spend nearly $400,000 out of pocket on medical ex- penses in retirement. 9 We’re not talking about spare change. My IRA will have to help cover costs as my wife and I age: in-home nurses, medical procedures, physical therapy, medicines. It adds up — potentially to the tune of $400,000. Next, I will likely have unplanned expenses. My house needs a new roof. My wife needs a new car. The basement floods. We all have emergency needs eventually, needs we can’t predict and don’t necessarily budget for in our annual income. My IRA will have to support some of those as well. These first three demands on my IRA — income, medical ex- penses, emergencies — are all money I’ll be spending. But if you’re like me and my friend James, you’ll also want to leave a legacy for your children, grandchildren, or charity. That means your IRA also has to cover your legacy needs. I have two adult daughters and four grandchildren. While I’ve worked with my daughters throughout their lives to be good sav- ers and plan for their own futures, I’d still like to leave something to them when I’m no longer here. My wife and I have also made commitments to charities that are important to us: religious insti- tutions, educational institutions, hunger organizations. If you want to leave a legacy, your IRA is pulling double duty. And there’s a big conflict embedded in that.
9 HealthView Insights. July 2019. "Retirement Health Care Cost Data Report." http: // www.hvsfinancial.com / white-papers /
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