New retirement ideas shake old beliefs

Baby boomers are changing the way we look at retirement, and they’ll be living a lifestyle quite different in their older years than their parents.

Michael Stein, certified financial planner and author of the book “The Prosperous Retirement – Guide to the New Reality,” told me in an interview that the rules of retirement have changed.

People are living longer, and they’re healthier and more vigorous in old age. The idea of a retirement as a prolonged period of “unemployment” is no longer acceptable for most Americans, either economically or socially.

Stein believes retirement is made up of three stages:

• “Go-go” phase. People are very active, and many people will continue working part time, perhaps switching to work that is more fulfilling. 

• “Slow-go” phase. People start slowing down. This phase generally beings when retirees reach their mid-70s, and it lasts for about 10 years. Homes may be downsized, and a quieter and less expensive life-style begins. 

• “No-go” phase. Failing health makes medical treatment and nursing home care likely.

In his book, Stein discusses how to figure how much your retirement is likely to cost year-by-year and how to make a guess about your longevity and the rate of inflation. You’ll also need to determine what your capital base might consist of, and how you could use your capital to provide the cash flow you need.  He also covers investments, insurance, and estate planning.

To carry out your retirement, Stein suggests you have a financial team made up of a certified financial planner, an estate-planning attorney, a tax adviser, an insurance adviser, and an investment adviser.

“A fantastic opportunity is in front of millions of Americans,” Stein said.  “They can seize the opportunity of an active retirement."