This sounds good, but how many people can actually live off their savings? And for how many years?
Both of these can be VERY expensive, and wipe out your savings within a year.
Think about that for a moment. Everything you worked so hard for could be taken away from you in a few short months.
Issues With Health Care
As we age, our health begins to deteriorate. Heart disease, arthritis, high blood pressure diabetes and other illnesses begin to take hold. Many of these health issues will require a person to take medication for years. As a result, their medical expenses will begin to rise.
This can put a major dent in a person’s savings over time.
Some people have declared bankruptcy or even DIED because they couldn’t afford their medicine…
There may come a time when you can’t live b yourself anymore. Your children may be able to take care of you, but what if they can’t?
This is where assisted living facilities and nursing homes come into play. Both options can be quire pricey, with prices increasing if medical issues that require nurses or other health care practitioners are involved.
Both of these unexpected expenses can wreck havoc on a person’s savings.
We haven’t discussed the possibility of stock market fluctuations causing the value of retirement accounts to decrease, but this is possibility as well.
However, if you have PASSIVE INCOME, that could help offset some of these costs.
The Power of Passive Income
How long can a person’s savings last if they have to deal with health care costs and assisted living expenses? What if a person must have a major surgery?
If you never considered passive income, this is a very good reason to get started TODAY on creating yours.
The average millionaire has seven streams of income. This is not to be confused with seven jobs, they have seven consistent sources of income.
This is often passive income, or money they make while they sleep. Common sources of passive income can include the following:
- Rental property
- Tax free municipal bonds
- Royalties (books, music, etc.)
- Dividend income
- Franchises
- Annuities
- Social media (monetized website, YouTube, etc.)
The goal here is simple: instead of relying on your savings upon retirement, start preparing now to have a steady stream of passive income. This way, you won’t have to touch your savings, unless you rally need to.
Another option is to own a business that can continue to flourish even when you’re not part of the day to day operations.
Get more tips in my books on finance and business:
