Mission Retirement 5 - 5:45
	SEGMENT 5: LIVING LONGER NARRATOR: THE GOOD NEWS IS THAT PEOPLE ARE LIVING LONGER… IF YOU LIVE TO AGE 65 THESE DAYS, YOU'RE LIKELY - ON AVERAGE - TO LIVE ANOTHER 17 YEARS… THAT MEANS HALF THE CURRENT GENERATION OF RETIREES WILL LIVE PAST 82… 25% WILL MAKE IT INTO THEIR 90's… BUT THE BAD NEWS IS THAT AS PEOPLE LIVE LONGER, THE COST OF RETIREMENT GETS MORE EXPENSIVE… WITH INFLATION AND ESPECIALLY WITH RISING HEALTH CARE COSTS. SO PEOPLE NEED TO TAKE STEPS TO MAKE SURE THEY DON'T OUTLIVE THEIR SAVINGS… Sequence of Plano Senior center… exteriors of shots of Dick Trankle in the Center… to shots of activities, like dominoes… LIKE MANY WHO COME TO THE PLANO SENIOR CENTER, DICK TRANKLE STAYS YOUNG BY STAYING ACTIVE… Dick Trankle There's so many things to do here: the exercise room, pool here, I'm very involve din the computer training here… EIGHTEEN YEARS AGO, WHEN HE WAS 62, DICK TRANKLE DECIDED TO RETIRE… HE HAD ABOUT $250,000 IN SAVINGS AND FIGURED THAT WOULD BE AMPLE TO LIVE ON BECAUSE HE DIDN'T EXPECT TO LIVE MUCH LONGER… Dick Trankle I figured I was going to be gone at 70… 72… 73… You know my dad died at 60, my mother died at 83. FORTUNATELY, TRANKLE GOT SOME GOOD ADVICE AT THE TIME… Trankle I went to//, a financial advisor and I asked them if I retired now what kind of income I would have. I had $250,000 and I was advised to put it an annuity, I'd get a monthly income. Graphic… IT WORKED LIKE THIS - TRANKEL TOOK HIS $250,000 AND BOUGHT AN ANNUITY THAT GUARANTEED HIM AN INCOME OF $2,000/ MONTH FOR 25 YEARS… ADDED TO $1,000/MONTH IN SOCIAL SECURITY, TRANKLE WAS GUARANTEED A MONTHLY INCOME OF $3,000… Trankle It's a steady income for me. I know what I'm going to get every month. I know what I can spend and what I can't spend. NARRATOR: WITH EVERYONE LIVING MUCH LONGER THAN THEY EXPECT, EXPERTS NOW RECOMMEND ANNUITIES THAT PAY AN INCOME FOR YOUR ENTIRE LIFE… Matt Greenwald I think life annuities are a great idea, and they're underused, and that's a shame. Life annuities are a particular type of annuity that provides a guaranteed stream of income for life. No one knows how long they're going to live, but insurance companies know how long a group of people will live, and that allows them to protect everyone. NARRATOR: BUT EXPERTS ADVISE CAUTION WHEN BUYING ANNUITIES… CHECK OUT THE PRODUCT… AND THE PEOPLE SELLING IT… Dallas Salisbury Annuities can be something that you need to be very careful with. Number one, you need to - to be very careful to look at the fees. Number two, you need to carefully look at the cost of that annuity. Number three, you need to make sure that you're buying it from a highly rated, highly reputable organization. But can one get through that maze and end up with security for a lifetime? Absolutely. DICK TRANKLE IS THANKFUL THAT HE BOUGHT AN ANNUITY… IT'S HELPED THROUGH YEARS HE NEVER THOUGHT HE'D SEE… Dick Trankle When I reached 70, I said, “Well, that's it.” And then all of a sudden you're 75. I says, “Well, I missed that one.” And then now I'm 80. So I don't know where it's going to go. Matt Greenwald In 1950, the average person retired at 68 and died at 72. Financial preparation for retirement: easy. Now, people are retiring around 62, 63 and many people are living into their nineties. Financial preparation: much more difficult. The people who really have financial difficulty in retirement are the people who live a long time. They're the lucky ones - run into financial difficulty. Sequence at Wellness Center… Seniors getting check-ups… NARRATOR: THAT'S THE IRONY… EVERYONE WANTS TO LIVE LONGER… BUT LONG LIFE OFTEN BRINGS CHRONIC ILLNESS, WHICH CAN BE MUCH MORE COSTLY THAN PEOPLE EXPECT… Dallas Salisbury Medicare, even after you have it, only pays about half of the average retiree's medical expenses, so if you say, “Well, I need enough money to pay the Medicare premium. I need enough money to pay what's on top of that, and I assume I'm only going to live 'til the mid-eighties, then I need savings of about $300,000.” If you're like my great-aunt that just passed away at a hundred and five, then you need about $800,000 for a couple, and it's just a great deal of expense. Sequence of seniors at Senior Center dance… Dallas Salisbury It comes down to longevity - medical advances, new drugs, the fact that individuals may well live to 95 and 100, that we're now talking about people having the prospect, after age 65, of living for as long as all of the years since they got out of high school. And that dynamic, those s- -- that set of changes underlines that retirement can't be taken for granted. No one should make the decision to retire until they've done a careful plan in their own self-interest, to make sure they've got enough to get through the rest of their life. SEGMENT 4: THE RETIREMENT DIRECTORY (AARP) NARRATOR: REACHING RETIREMENT AGE DOESN'T MEAN THE END TO RETIREMENT PLANNING… IN FACT, THAT'S WHEN YOU FACE THE MOST IMPORTANT QUESTION… CAN YOU AFFORD TO RETIRE? MAKING THE RETIREMENT DECISION TAKES CAREFUL PLANNING… AND LIVING IN RETIREMENT TAKES CAREFUL AND CONINUOUS MANAGEMENT OF YOUR SAVINGS… OTHERWISE, THE GOLDEN YEARS CAN BECOME GRIM YEARS… Ext of Crabbs house… cut to Crabbs at table going over their bills… NARRATOR: THAT'S A LESSON THAT WINSON AND BESS CRABB LEARNED THE HARD WAY… Winson Crabb You got to plan early and you've got to stay with it. And if you don't your retirement is not going to be real sweet. You know you'll burn up all your money pretty quick. AFTER MORE THAN 40 YEARS OF WORK, WINSON CRABB RETIRED AT THE AGE OF 65… HE HAD A SMALL MONTHLY PENSION FROM AN OLD UNION JOB PLUS $120,000 IN 401(k) SAVINGS … BUT THE CRABBS CASHED IN THEIR SAVINGS IN 2003, AFTER THE STOCK MARKET HAD DROPPED DRAMATICALLY… W. CRABB: I was expecting $120 useable. B. CRABB: And we ended up with $65. AND BECAUSE THEY DIDN'T ROLL THEIR SAVINGS OVER INOT ANOTHER TAX-DEFERRED ACCOUNT, THEY HAD TO PAY TAXES… B. CRABB: And that took a lot of it out and we actually end up with what was 46. W. CRABB: 46 actually in the bank. B. CRABB: 46 out of $125,000. W. CRABB: $120,000. B. CRABB: Yeah and that was very disappointing, very, very. W. CRABB: And it's spooky, too. Crabbs in the kitchen… THE CRABB'S PROBLEMS GOT WORSE… AFTER PAYING OFF DEBTS AND OTHER EXPENSES, THEY HAD 20 THOUSAND DOLLARS LEFT… Bess Crabb It was devastating really because I mean we had planned on like I told you to take a cruise to, he was going to buy a motor home, we was going to do sight seeing, do some repairs on the house. Winson Crabb Now, we are unemployed with out about 20K. Dallas Salisbury Regrettably, the Crabbs are not unusual. Regrettably, one of the most common things that people do out of their 401(k) plans is they take a lump-sum distribution. They take it in income, they get hit with penalties, and they spend it quickly. WITH THEIR SAVINGS ALL BUT GONE… BOTH OF THE CRABBS HAD TO GO BACK TO WORK… WINSON IS NOW 68… Winson Crabb You start thinking about, “boy, did I do something wrong here?” somewhere you know because I'm going to have to do the same thing I would have done at 40: go back to work. John Rother In today's society there is not much that allows you to adapt to inadequate savings other than working longer. Once you're at retirement age, if you are 62, 65 and you haven't kept that money in your 401k plan and you don't have a traditional pension you really are left with two choices. One move to a very low cost state and you know live as simply as possible or two go back to work and save as much as you can and put off that time when you need to be drawing down on those savings. AVOIDING FINANCIAL DIFFICULTY IN RETIREMENT TAKES CAREFUL PREPARATION, THE EXPERTS SAY… Hedrick Smith If you were the Crabbs or anybody else and you had a retirement checklist // can you tick off the key things on a retirement checklist? Graphic with checklist… Dallas Salisbury I think the key checklist is, “How much will my Social Security benefit be? How much bigger it may be by waiting?” The second checklist, “Will I have health insurance from where? How much is it going to cost me?” The third checklist item is, “How much income will my savings produce on top of Social Security?” The fourth checklist item is, “What are my expenses likely to be now and in the future? Can I really afford to retire?” Back to Crabbs at table going over expenses of Winson's work… STILL LOOKING FOR THE DAY WHEN THEY CAN AFFORD TO RETIRE, THE CRABBS OFFER A CAUTIONARY WORD ABOUT THE NEED TO PLAN CAREFULLY. Bess Crabb I couldn't stress to anyone how important it is to sit down and take it very seriously because it is and as you get older it gets more serious.