Pattie Lovett-Reid: How much do the wealthy need to retire?
By Pattie Lovett-Reid
Chief Financial Commentator, CTV
I'm often asked: how will I know if I have enough money to see me through my retirement? And to be honest, I'm not often asked this question by those considered to be wealthy. But a new report out by Spectrem Group in Illinois, found that 20 per cent of ultra-high-net-worth investors, defined as those with investable assets between $5 to $25 million, are in fact worried about having enough money to last throughout retirement. Dominating concerns are health-care costs, taxes, and low interest rates.
In a perfect world, we all would like to enter into retirement thinking we can maintain our current lifestyle. High net-worth individuals are no different they just typically, spend lots of money. It is the same equation - just bigger numbers. It is difficult to dial back a luxurious lifestyle. You get used to having what you want when you want it.
Something else to consider: a report released this past week by the British Medical Journal found that the super-rich live longer and healthier lives - they have better diets, exercise more and smoke less. The super rich have the challenge of living longer and therefore the money has to last longer.
Of course their will be some who have enough for retirement but their main concern is about leaving an estate. not only leaving an estate - growing their estate to preserve family wealth for generations to come.
But the one thing the really rich have over the rest of us is the luxury of control. Any way you look at it , they will have enough money to see them through their retirement but they may simply have to spend a little less.
The question will be: what are they willing to give up?