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More Scared of Going Broke Than Dying? 9 Ways To Beat Retirement Anxiety

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Most people don’t like thinking about death but for many, the idea of running out of money in retirement is even scarier.

A new study from Allianz Life found that 64% of Americans feel stressed about the possibility of outliving their savings, a fear that cuts across age groups and financial backgrounds.

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Janeil Pierre, an accredited financial counselor and the author of “The Money Confidence Code,” said it’s not just a fear rooted in financial hardship, but “the emotional and psychological toll of watching one’s quality of life decline after decades of work.”

Pierre and other experts offer some tips to beat this anxiety by being prepared.

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Clarity is the first step, Pierre said. “Define what a financially secure future looks and feels like for you. Do you want to travel, downsize, support family or simply maintain your current lifestyle? Having a clear vision provides a foundation for action.”

Robert R. Johnson, PhD, a certified financial analyst and professor of finance in the Heider College of Business at Creighton University, refers to this as “a roadmap,” or an “investment policy statement” (IPS), a tool that “takes into account the investor’s time horizon, risk tolerance, goals and objectives and unique circumstances. An IPS is unique to an individual.”

Once that’s in place, calculate your retirement needs, create a plan, automate your savings and regularly check your progress. The more intentional you are, the more empowered you’ll feel, Pierre suggested.

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Another approach is to work backward, Johnson said. “That is, they need to establish a budget in retirement and calculate how much they need to save and invest to achieve that goal.”

Using a reliable online calculator, such as the one on Calculator.net or Fidelity, can help, Pierre added. “Aim to replace 70%-80% of your pre-retirement income annually in retirement; personalized tools will give you a clearer picture,” she said. Knowledge replaces fear.

Additionally, determine a realistic budget, Johnson said. “Oftentimes, people underestimate their expenses in retirement.”

Guaranteed income sources, such as Social Security, pensions or certain types of annuities, can provide peace of mind due to their stable and predictable cash flow, regardless of market conditions, Pierre said.

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