The Alemian File: Inflation

In Episode 7 of The Alemian File, retirement expert David Alemian looks at inflation, one of the 7 Retirement Killers.

Do you know what it will cost you to live 20 years from now? Thirty years from now? Forty years from?

Inflation is one of the retirement killers because, if you don’t know what it will cost you to live, how can you possibly know if you will have enough money for retirement?

Inflation is one of the big reasons people run out of money in retirement. I’m going to give you a way to easily calculate in a matter of seconds how much money you will need for retirement. You can then use the retirement plan described in Episode 3 of The Alemian File to design a retirement plan that works for you.

For the last 5 decades, inflation has averaged 3.33%. At that rate, the price of most things doubles every 21.6 years. Whatever it costs you to live now, in about 21.6 years it will cost you double.

A 44-year-old physician with monthly expenses of $15,000 will need about $30,000 per month by age 65. We are living longer so let’s look at another 21.6 years. When the physician is 86 years old and in the middle of retirement, it will then cost him about $60,000 per month… that's just to maintain the same standard of living. If your money is in a taxable retirement savings vehicle, how much money will you need to take out of your retirement plan to have $60,000 per month? Double? You can now see why people run out of money in retirement if they live long enough.

Use these calculations and apply them to the physician’s retirement plan described in episode three of The Alemian File. It will ensure you will have enough money to last throughout retirement. You simply use financing to make the plan big enough to provide the needed tax free income.

If you want help with your calculations, or you have questions, email me at Check out my website, and come back here next week to Physicians Money Digest for another edition of The Alemian File.

Related Videos
Victor J. Dzau, MD, gives expert advice
Victor J. Dzau, MD, gives expert advice
© 2023 MJH Life Sciences

All rights reserved.