Investments

The majority of retirees today aren't just living longer — they're also living younger. Still vital and energetic once they hit 65 (long considered a benchmark of old age), retirees can now expect to live another 20 to 30 years, thus opening up a tremendous range of options and opportunities for this next life stage.

While these extra years offer "a longevity bonus," they also present longevity risk — the risk that you could outlive your savings. In fact, concerns about having enough money in retirement are reflected in The 2006 Merrill Lynch New Retirement Study. The findings show that 41% of all adults do not feel prepared financially for retirement, and only 25% of baby boomers say they feel very or fairly well prepared for a secure retirement.

You contributed to an IRA to help fund your retirement lifestyle. In fact, it's quite possible you've rolled over your assets from multiple employers' plans into a single IRA to form the foundation of your retirement savings. But what if some or all of those assets survive you? In that event, your IRA can work as a wealth-transfer tool, allowing a beneficiary to enjoy continued tax-deferred growth potential and an income stream.

Your first priority: Make sure your beneficiary information is updated. Families change, through births, marriages, divorces and deaths. At these critical times in your life, it's easy for things like beneficiary designations to slip through the cracks. "Some people forget to change their beneficiaries.

Time flies. Before you know it, the next generation will be in charge of shaping our local, national and international communities. Your children will be out there, forging ahead in a fast-changing, complex, competitive world. As parents or grandparents, you want to give your family's next generation every opportunity to be happy, productive and successful.

One of the best advantages you can provide for them is the gift of higher education. Think of it as an investment for a lifetime of achievement. Taking the right financial steps now can give your children or grandchildren the resources they need to attend college or graduate school. The basic yearly costs of attending college-tuition, room and board, fees and books-have increased dramatically over the last two decades. During this period, average annual increases in college costs have exceeded annual inflation rates (as measured by the Consumer Price Index) almost every year. Today's cost of higher education is significant to most families, particularly if several children are destined for college. Most parents use a combination of sources to manage and fund the costs, including financial aid such as grants, scholarships, personal loans and savings. Merrill Lynch can help you in seeking to achieve your college funding goals. Call your Merrill Lynch Financial Advisor for your free college planning analysis that will analyze how much college may cost and how much you should save to meet these expenses.

Your financial plans for retirement may be personal, but bringing your plan to your business makes good sense for you and your employees. Owners who offer an employee plan tend to save more personally and have larger and more successful businesses, according to the Merrill Lynch 2007 New Retirement Study: A Perspective From Small Business Owners and Their Employees. In addition, the benefits are more than just financial: Owners with personal retirement plans reported that they feel more prepared for retirement than do those without plans.

The new retirement
Integrating business and personal financial plans is all the more important for owners who rely on their businesses to fund their retirements.