It wasn't so long ago that the average retirement most people envisioned involved saying good riddance to a time clock, moving to some warm retreat, traveling, and spending the rest of the days playing golf and bingo, gardening, chasing the grandchildren, and otherwise relaxing. Such a retirement dream can still be realized today, but it's certainly much more difficult with lengthening life spans, the solvency of Social Security and Medicare in question, and tumultuous markets. Retirement planning is more important than ever in today's world of uncertainty.

With the average life span increasing, you could spend almost a third of your life in retirement. This possibility could naturally lead you to question how you'll possibly pay for your retirement and if you'll even need to delay it.

Working through Retirement. You'll need to take your work plans into consideration during your retirement planning since it will impact how much you need to save for your retirement and the benefit you'll get from Social Security.

Do factor in your profession/job if you plan to continue working. It will be much easier for you to continue working at your own pace if you have a job allowing for either a partial retirement or a status change, such as to a contractor. Otherwise, you might be forced to find a completely different job to continue working.

Prepare yourself for the likelihood that the decision to work through retirement will impact your existing retirement plans, including plans to travel and to spend time with family. As you get closer to retirement, you'll need to take into account the condition of your overall health and any ailments you might have that would affect the type of job you can get or continue doing during retirement.

Paying for Retirement. The chaos and confusion surrounding the stock market during the past few years taught many Americans two lessons: 1. Never rely on investment returns to fund retirement solely, and 2. One can save too little, but never too much.

Increasing your savings could mean making some difficult sacrifices for your future financial betterment, such as by saving versus spending bonuses and inheritances and keeping your debt manageable at all times.

You should contact the Social Security Administration to verify your full-retirement age and get an estimate of your expected benefits. This information can affect when you decide to start collecting benefits and help you determine if and how long you want to work past your retirement age.

Make sure that your money is diversified in both allocations and asset classes. You can contact a financial planner to help ensure this is done in a way that best suits your financial goals and needs.
Don't forget to be flexible when it comes to your retirement plan, budget, and savings. After all, you might find that what you envision today isn't the same as what you envision 10 or 20 years from now.

Expect Obstacles. Life in other areas won't just stop because you're planning and saving for your retirement. In fact, there will likely be many other financial obstacles and challenges thrown at you. You need to be prepared and plan for what you can. For example, you can prevent possibly being financially responsible for your aging parent's long-term care needs by having a proactive discussion with them about the presence or absence of Long-Term Care insurance and the state of their finances. Another example would be having a realistic discussion with your children about your ability or inability to pay their college tuition.

Here are a few things you can get started on today:

  • Contact a financial planner to help you run the numbers and get an estimate on how much you'll need to maintain your current lifestyle during retirement. The planner will use that estimate and your age, current income, expected income, savings, and projected date of retirement to help you set or adjust your retirement savings goals.
  • Once you've set your goals, you can create a savings budget to help you put the right amount toward savings each month. However, don't forget to include other areas you must save toward, such as an emergency fund or child's college tuition.
  • Determine if and what sacrifices you'll need to make now to achieve your retirement savings goals and ultimately secure your financial future.
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