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Retirement Planning: How long will you live?

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One of the biggest challenge of retirement planning is not knowing how long you'll live. If you don't last much beyond your 60's, there's less chance of outliving your savings. But if you stick around into your 80's or 90's you are more likely to run short of cash.

How to estimate your remaining life expectancy?

Two actuarial groups have developed a way to make this important calculation a bit more simple.

The free online tool can be found here.

The analyzer was developed by the American Academy of Actuaries and the Society of Actuaries. It is free and doesn't require much work. You need to input only four variables:

  • date of birth
  • gender
  • general health assessment
  • whether you smoke

The output could greatly affect your financial planning.

When looking forward to retirement, the last thing you need is to worry about money. If you are having trouble dealing with budget concerns associated with your fixed retirement income, using a reverse mortgage to tap into your home equity can help. A tool called a reverse mortgage calculator can help you determine how much of that equity is available to you. Then, as long as you maintain residency in your home, you can select a lender from the available list of banks that offer reverse mortgages and borrow from that lender unimpeded. You can spend the money on any expenses you have without limitations. However, you will be responsible for maintaining your home for the duration of the long-term reverse loan. You also have to agree to the sale of the home, if you cannot repay the loan when you leave the property.

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