What If I Die Before I Retire?

11 May, 2009  |  Written by  |  under Personal Finance Articles

Did you ever think that you might die before you retire?  I don’t want to be morbid, but I think that it is something that I must at least acknowledge.  There is a chance that I might die before I retire.

The reason why I bring this up is that I think that it has a profound impact on my financial planning.  But, very few people ever really talk about it.

Many personal finance gurus talk ad nauseam about planning for retirement, saving for retirement, working for retirement, etc.  But, what if I never retire?  I could kick the bucket the week before my retirement party.  Now that would suck!!

Thousands of Americans die at work every year.  Sure, we hope that they have financially prepared for their death by buying life insurance.  Most personal finance articles would hammer this point home.  But that is not the purpose of this post.

I want to think about whether my financial planning for retirement should change with the knowledge that I might die before I get there.  I want to think about the stuff I deferred doing until I retire.  I want to think about my unfulfilled goals and dreams?

I like to talk about conscious living where I live every day knowing what I want out of life and work every day to accomplish those life dreams.  Because I know that I could die prematurely, I want to make the most of each day here.  And, my financial planning for retirement must take into account the possibility that I will not die of old age.

Financial planning must help people balance the conflicting interests of spending money now versus spending money later.  Without balance, I might spend too much money now and not have enough for retirement.  But, the opposite is also possibility.

I don’t want to live like a pauper now so that I can live like a king when I retire.  I want to find the right balance between saving enough, but not depriving me things which make me happy today. That is not good.  Instead, there needs to be a way to maximize your finances so that the present is just as good as the future.

This is my goal for my own financial plan.  I want to find balance between living for today and living for tomorrow.  Don’t get me wrong, I don’t think that people should not save for retirement.  But, some people go overboard and put off things now with the idea that they will do them when they retire.

If I die before I retire, this balance is even more important.  I don’t want to put off life’s greatest joys so that I might experience them later.  Later may never come.  Therefore, I want to experience them when I can, but, without mortgaging my future.  I must keep balance in my life so that my retirement is just as rewarding as the present.

This financial balance is holy grail that I am seeking.  I hope that my writing here at Spending It will help me and you find this financial balance.

Now a few questions for you.  I really would like this blog to be a two way conversation and that can only happen if you leave comments.  So, here are some questions to get you commenting.  Have you thought about dying before retirement?  If so, how has this affected your financial planning?  What impact does this have on you financial planning for retirement?

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2 Responses so far | Have Your Say!

  1. Carrie  |  May 13th, 2009 at 6:38 pm #

    it doesn’t affect my planning for retirement. i’m able to live comfortably and save for retirement and if i die before i retire then my family will inherit my retirement funds and i can make them more comfortable.

    Carrie - Gravatar
  2. Joyellen  |  June 14th, 2009 at 3:27 am #

    I’m 35 and keep getting laid off from jobs because of the field I’m in. I have no family, no kids and plan to stay that way. So if I’m in a job where a 401(k) etc is offered with a match, I will use it as a rainy day fund in case I get laid off again. Even with taxes/penalties, I still come out way on top rather than putting it into a savings account. I only use the “guaranteed income” option so I don’t lose money in the meantime. And what if I just leave it there after another job? Then unemployment runs out? And I have to live out of my car, or even die before the typical “retirement age”? The way I see it, if I can’t live to retirement age, then there’s no use for a “nest egg”. I’d rather use it while I’m here to enjoy it instead of sacking it away for a time I might not live to see. I have no retirement savings needless to say. Neither do many other Gen-Xers I know.

    Joyellen - Gravatar

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