Home / Community / Commentary / The Alemian File Episode 5- Inflation

The Alemian File Episode 5- Inflation

By David Alemian

Do you know what it will cost you to live 20, 30 or 40 years from now?   If you don’t know what it will cost you to live in retirement, how can you possibly know if you will have enough money for retirement? The Alemian file series about the seven retirement killers continues with the topic of inflation.

I’m going to give you a way you can easily calculate in a matter of seconds how much money you will need for retirement. I want to be accurate here, so I’m going to use the long-term inflation rate, because we are calculating for the future.

For the last five decades, inflation has averaged 3.33%. At that rate, the cost of most things doubles about every 20 years or so. Whatever it costs you to live now, in about 20 will cost you double. The only caveat being any debts or costs that will go away.

For example: If you are going to pay off your home mortgage and never have another mortgage again, you could subtract the cost of the mortgage. If you plan on ever refinancing your mortgage, or buying another home in the future, then you need to leave the cost of the mortgage in.

Inflation coupled with taxes is the reason why the 401(k) or IRA, absolutely cannot possibly work as your primary retirement savings vehicle and here’s why. A 45-year-old with monthly living expenses of $5,000 per month will need about $10,000 per month by age 65. But we’re living longer, so add another 20 years, and at age 85 that number doubles to $20,000 per month.  How much money will you need to take out of your taxable 401(k) or IRA to have $20,000 per month? Possibly $40,000 per month?

You can see why people run out of money in retirement if they live long enough. You can also see the importance of having tax-free income. Creating a tax-free retirement income with a permanent cash value life insurance policy is a key first step to building the retirement of your dreams.

In the coming episodes, I’ll focus on how to protect you and your family from all seven of the retirement killers.

So remember to absolutely make sure you come back here next week for another edition of the Alemian file. If you have questions, send an email to David@theAlemianfile.com, because I answer every email I get. In the meantime, check out and “LIKE” the Alemian file Facebook page, or simply go to the www.theAlemianfile.com.


About David Alemian

Successfully creating affordable retirement plans guaranteed to last a lifetime is a unique, specialty skill. It’s a challenging arena but respected writer David Alemian makes it look easy. Alemian is a leading retirement expert and nationally recognized authority whose expertise is shared via video columns, numerous journals, and talk-shows.

His national recognition results from both revolutionizing and revitalizing how organizations and individuals like you and me plan and save for retirement. Alemian is considered “The Go-To Guy” for creating and implementing absolutely irresistible, lifetime retirement pension programs.

Formerly the host of “It’s About Money” Radio Show, Alemian has also produced and is featured in over 200 financial education videos. Additional content can be found in many well-respected, publications including: MD Magazine, Physician’s Money Digest, Physicians Practice, Journal of Clinical Oncology, Consultant Live, Psychiatric Times, Cancer Network, OB/GYN.net, and The Healthcare Executives Network.