One of our chief priorities as we work for our clients here at AgingOptions is helping them protect their assets in retirement. It’s all well and good to save money while you’re working, but if you haven’t planned carefully to make your assets last, you may very likely find yourself outliving your resources. This forces many retirees into lifestyles that rob them of joy in what is supposed to be their “golden years.”

For that reason we’re always on the lookout for helpful articles about retirement finances, such as this very recent article from the website NextAvenue.org. It’s called simply “Where to Find Retirement Income That Rises with Inflation,” and we offer it to you not as a prescription telling you what to do with your money but as food for thought. The message here is that inflation can be the hidden danger that causes your retirement savings to disappear faster than you had projected, and you had better factor inflation into your financial plan.

According to the article, consumer prices have averaged less than a two percent annual increase over the past decade. But this apparently low number can mask a much greater problem. As we have pointed out before, traditional consumer price gauges may not adequately represent the economic challenges faced by seniors, who tend to be much more adversely impacted by rising health care costs. The NextAvenue article says health care inflation is closer to 3.6 percent per year, and climbing.

Even the apparently low inflation numbers from the past decade may be misleading. The NextAvenue article quotes a Maryland-based financial planner who states, “Historically speaking, inflation has been between 3 and 3 1/4 percent, on average.” In his view, this suggests we’re probably due for higher inflation on the horizon. “History would tell us it is very likely we will see a surge of inflation again at some point in the future, and we need to know how to protect ourselves from it,” says this expert. The other factor affecting this scenario is that seniors are living much longer lives, which means you need to be planning for a rate of return that allows you to maintain the lifestyle you’ve planned for and one that compensates for rising costs of just about everything.

The article from NextAvenue lists four possible strategies that may meet this inflation challenge. Are any of these appropriate for you? That depends on many variables, which is why we urge you to let us review your particular situation before you make any major financial decisions that could impact your retirement. In brief, the four strategies from the article are:

• Treasury Inflation-Protected Securities: Known as TIPS, these are government-backed bonds which are designed to increase in value as the Consumer Price Index increases. You can add TIPS to your portfolio, buying directly from the government in $100 increments. Both Fidelity and Vanguard also offer funds that include TIPS.

• Annuities: Most of us know at least a little about these popular investments. Annuities are popular because they are considered a secure way to earn guaranteed income for life. But returns can be low and fees can be high, so before you invest in any annuities make sure you get some good objective advice from someone who is not a commissioned annuities salesperson!

• Stocks: Investing in stocks is one way to generate solid growth that more than compensates for rising inflation. But there are definitely risks in investing in stocks, and the NextAvenue article outlines some of the more obvious ones. The author also gives a rule of thumb she uses to determine the percentage of one’s portfolio she feels should be in stocks: it’s 110 minus the investor’s age. How does your portfolio shape up? (Again, we work with investment experts who can review this with you.)

• Commercial Real Estate: We won’t comment much on this here except to point out that, if you choose, you can invest in a Real Estate Investment Trust (REIT) through established firms such as Vanguard. Again, we urge you to get comprehensive advice before investing.

 “Comprehensive advice” about retirement is our specialty at AgingOptions. We call our retirement planning process LifePlanning, and in order to show you the benefits of this groundbreaking approach, we offer brief LifePlanning Seminars that are completely free. Wouldn’t it be wonderful to have your finances, your housing options, your legal affairs, your medical insurance, even communication with your loved ones all dealt with in one plan? That’s how a LifePlan works. Find out more by taking a few hours to join us at an upcoming seminar. We know you’ll be very, very glad you did. For dates, times and registration, click on the Upcoming Events tab, or give us a call. Let us help guide you into the retirement future that you’ve dreamed of. We’ll look forward to meeting you soon.

(originally reported at www.nextavenue.org)