The Big Unknown

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					                                  The Big Unknown

"When am I going to be able to retire?" is a question that is on the mind of many
Americans, often keeping many of us up at night and giving many investors serious
amounts of heartburn every time they look at the balance of their 401K plans.

The current economic environment coupled with the uncertain future solvency of Social
Security in the US, is causing more and more of us to question when are we going to be
able to retire, if at all. The vision of leisurely afternoons on the golf course is beginning
to look like a chimera...

The reality is not terribly encouraging. Just in the past decade we lived through the Great
Recession, the global financial crisis, unemployment figures reaching double digits and
we witnessed our houses lose value due to the burst of the real estate bubble. So what are
we looking at - little, if any, equity in our homes; unpredictable value in our 401Ks and
possibly some savings. The stock market is still below the levels reached in 2001 and we
now have more than 11 years of inflation since then. In efforts to boost the economy, the
Federal Reserve is keeping interest rates abnormally low and will not even begin raising
them until 2014. In the equation of retirement, with variables such as housing and the
volatile financial markets, the age of when most Americans will be able to retire is
becoming the big unknown. With all of that in mind more and more of us are realizing
the solution is only one - we will have to work longer. According to the latest Gallup
poll, the average age at which Americans expect to retire has been progressively climbing
up since the mid-1990s, and has now reached 67 years.

Still, younger workers seem to believe that things will eventually work out better than
their older peers. In mid-April, Gallup conducted its annual Economy and Personal
Finance survey, which concluded that people who are currently under the age of 40
expect to retire at age 65, compared to those who are over 40, still working and expect to
retire not before 68. Why the difference? The younger population has the luxury of time.
And although no one can predict the direction of the housing market or the global
financial markets, those under 40 have at least 20 years to make changes in their lives;
changes that are in their own control. Such changes could be efforts to increase the
savings rate, pay off debt or rebalance their 401K portfolio. And most importantly just
wait and hopefully weather the storm.

Those over 50, who don't have time on their side can rely on different methods to achieve
their retirement goals. Some of those include downsizing, taking advantage of products
such as annuities that have contractual guarantees to pay income for life, or cash value
life insurance and market linked CDs (which I recently discussed in details on this blog)
or simply choosing a second career that they love. This will give a new flavor and better
outlook on the possibility of having to work longer.

And finally, even if the retirement age gets pushed further out for most of us, statistically
the odds are in our favor for enjoying some golden years since the average life
expectancy in the US is now 78 years.
The Baron group operates in Monroe Louisiana and is managed by Timothy Mobley. We
represent some of the best insurance companies in the world in the products we offer to
our Louisiana clients.

We currently represent AIG Americo, Old Mutual, American Equity Investment Life, US
financial, Presidential Life, Shenandoah Life, Assurant Health, Chesapeake Life, World
Insurance, Wellcare and Pyramid.

Tim Mobley is a Louisiana licensed professional with over twenty years of experience in
a wide range of financial products. Tim is committed to recommending the services and
products that best suit the stated financial needs and objectives of a variety of individuals.

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