A retirement starting at 65 and lasting until 85 spans just 20 years, with the vibrant 'go-go' phase—often defined as the first 5 to 7 years—growing increasingly brief for today’s retirees. Investors must act decisively to maximize savings and income-generating assets now.
- Retirement from 65 to 85 equals 20 years of post-work life
- The 'go-go' phase typically lasts only 5–7 years
- VYM, VIG, and VPU are key ETFs for income-focused retirement portfolios
- Annuities (ANNU) are increasingly used to mitigate longevity risk
- Early investment in income-generating assets is critical to sustainability
For the typical retiree who begins at age 65 and lives to 85, the total retirement window is 20 years. Yet the 'go-go' years—when retirees are physically and mentally active, travel frequently, and spend freely—are often limited to just five to seven of those years. This compressed window underscores the urgency of building financial resilience early. Historical data shows that retirees in the U.S. now live, on average, 18–20 years post-retirement. With inflation and rising healthcare costs, even a modest annual withdrawal rate of 4% can deplete savings faster than anticipated. This makes income-focused strategies—such as dividend growth investing and guaranteed income products—essential. Assets like the Vanguard High Dividend Yield ETF (VYM), the Vanguard Dividend Appreciation ETF (VIG), and the Vanguard Utilities ETF (VPU) offer exposure to stable, growing income streams, helping retirees stretch their capital. Additionally, annuities (ANNU) provide a mechanism to secure lifetime income, reducing longevity risk. These tools are increasingly critical as retirees face a growing mismatch between life expectancy and financial preparedness. The market response reflects this shift: demand for dividend-paying equities and deferred annuities has risen in recent years. Financial advisors now emphasize early and aggressive savings, particularly in tax-advantaged accounts, to bridge the gap between retirement onset and the onset of financial strain.