Retirement planning is full of uncertainties: How long will you want to or be able to work? How many decades can you expect to live? What will happen in the markets in the meantime?
One way to fill the knowledge gap is with rules of thumb, nuggets of conventional wisdom, or one-size-fits-all retirement products. Do a quick Google search and you'll find easy answers to how much you should save for retirement and how you can safely spend it. Meanwhile, mutual fund companies will happily sell you a single fund that offers a simple plan for investing your nest egg.
Too easy and too simple, says Michael Kitces, a financial planner and director of research at Pinnacle Advisory Group in Columbia, Md. "We rely too much on rough guidelines or underdeveloped knowledge instead of rigorous analysis," he says. Kitces is one of a group of big thinkers you'll meet in this story who say that you can do better.
New ideas about retirement are especially urgent now. Today's markets may not be priced to deliver high returns to retirees or those in their peak savings years; at the same time, the cost of health care in retirement keeps rising.
The good news is that if you break away from the obvious answers, you'll discover that you have options for the life you want after so many years at work.
On the pages that follow are five big ideas from some of the retirement-planning world's sharpest minds:
Forget the 4% withdrawal rule: Wade Pfau, professor of retirement income, American College
You'll spend less as you age: David Blanchett, director of research, Morningstar Investment Management
Plan to pay for future health costs: Carolyn McClanahan, president, Life Planning Partners
Plan for the critical first decade: Michael Kitces, partner and director of research, Pinnacle Advisory
Social Security is the best deal: Alicia Munnell, professor of management, Boston College