Retirement Planning for Nurses: A Beginner’s Guide

Planning for retirement is more than just participating in a retirement plan at work.

It requires an understanding and knowledge around realities of retirement, financial risks associated with entering retirement, gaining knowledge of all the options and strategies that are available and most importantly it requires a plan that is acted upon and reviewed on an ongoing basis.

One of the questions that you should be asking yourself as you are getting closer to retirement is “What’s My Retirement Income Gap?”

Is the current plan that has been put in place strong and adequate to take me through potentially 20-30 years in retirement?

Not planning early and not having a clear financial plan in place results in people retiring later and this reality can be seen by the fact that in 1991, just 11 percent of workers anticipated retiring after age 65.

In 2013 though, 36 percent of workers report they expect to wait until after age 65 to retire*.

So in order to close that gap a full plan has to be put in place and that includes knowing how much to save and understanding how to spend the money in an efficient way one’s retirement begins.

So planning before entering retirement is crucial but planning during retirement is also crucial and the some of the main risk factors that have to be addressed are the following:


Longevity Risk

The Longevity risk is the risk of running out of money before you die.

The Longevity risk key as if affects all the other risk because the longer you live, all the other risks increase.

Living longer is good, but it also now means that you may be seeing a longer life during your retirement years, which then will put a strain on the assets that are planned to support you in the retirement years



Market Risk

The fear of losing your assets is a chief motivator for people, especially when it comes to the assets that have been set aside as a main source of income during retirement.

That means that often individuals in retirement make a short minded decision on what to do with their assets and on how to invest these assets.

Even though stocks have high volatility over the short-term, stock over the long-term still outpaces most other financial assets.

About the data, this is for illustrative purposes only and not indicative of any investment.

Stocks in this example are represented by the S&P 500® index, which is an unmanaged group of securities and considered to be representative of the U.S. stock market in general.

An investment cannot be made directly in an index.

Bonds are represented by the Bank of America Merrill Lynch 3-month U.S Treasury bill.

Government bonds and Treasury bills are guaranteed by the full faith and credit of the United States government as to the timely payment of principal and interest while stocks are not guaranteed and have been more volatile than the other Asset classes.


 Sequence of return risk

The order in which you specifically participate in the market return rates.

You may have a good long term average rate inside of your portfolio of return but gaining knowledge about how the sequence of these variable returns affect your portfolio is very important once you begin withdrawals.

Early negative market returns can drastically diminish your portfolio and if you are taking income at the same time it can be very difficult to ever recover from those losses.


Inflation risk

Can your portfolio and your other sources of income keep pace with the ongoing inflation?

Regrettably inflation does not take into consideration what you have in place and what your income needs are.  Inflation makes goods and services more expensive over time.

Your retirement income will have to last for your lifetime plus the income should be able to at least keep pace with inflation.

Health-care risk

The cost of health care can be expensive in retirement.

Medications, home care and other aspects of health care take up a good portion of an individual’s budget so an increased income level should be looking at to plan for potentially rising health care costs through retirement.


So in order to understand what you need to take a look at your income and needs by dividing them into 2 different categories.


BASIC NEEDS Discretionary Needs             




Health Care




New Car


On top of that make sure that legacy needs have been addressed.

What is the income plan for the surviving spouse, are there a desire to leave a legacy for kids/grandkids or some charitable cause.



Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 2013 Retirement Confidence Survey.

Zephyr STYLEAdvisor


Written by CreativeNurse Team

2016-22585  Exp.4/18