By Brian Goslow
Boston residents rank 10th in re-tirement readiness, according to a study of the country’s 30 biggest metropolitan areas by Ameriprise Financial Services, Inc. Minneapolis-St. Paul ranked first, followed by Raleigh-Durham, N.C., and Nashville, Tenn.
“Overall, Boston residents are doing well from a preparation standpoint,” the report stated. Over 75 percent have set aside money for retirement; 35 percent have determined the amount they’ll need during retirement, 10 percent above the national average.
Ameriprise Senior Financial Advisor Edward J. Lizotte credits the large num-ber of mutual fund and retirement fin-ance institutions in the state with creating a climate of retirement readiness not found in some other parts of the country.
“What that means is people have ac-cess to tremendous experts in the field of managing money,” Lizotte said.
“There are sophisticated companies — large Fortune 500 companies with 401(k) and 403(b) (for university, civil government and non-profit workers) retirement accounts. A lot of people work in these areas and are participating in those plans, much more than those in the south and Midwest where companies have less exposure to these plans.”
While he counsels his clients on retirement planning, at the end of the process, Lizotte said, it’s a personal responsibility. That could mean working later in life, or working part-time.” If possible, people should delay taking their Social Security payments; the later payments are taken, the greater the monthly check will be.
“If you haven’t already, start building your retirement nest egg,” said Lizotte, who encourages his clients to look into the future to see how they would financially be able to take care of themselves in 20 or 30 years. “You’re going to need to have a realistic budget to continue your lifestyle. If you’re not happy with the numbers you come up with, you should change your investment strategy.” The end goal figure should be supplemented, not supported, by Social Security and cost of living adjustments.
Society in general will have to carefully study how to address people living longer than in the past. “We haven’t begun to look at the big picture of a longer life,” Lizotte said. “How do young people pay for older people and who’s going to pay for their health benefits. We’re talking about people living into their 80s and 90s on a system based on a 1965 life expectancy.”