What is retirement? The day you end your career at "the company"? The day you receive your first Social Security check or take your first IRA/401K withdrawal? Some other event? Probably not. Today's Americans, more than previous generations, view retirement as an active journey filled with new opportunities.
Americans who make it to age 65, for example, have a great chance to live well into their eighties — that's what the census statistics show. That means many people will experience "retirements" that last as long as "working careers." Enjoying those years is just one reason to start planning ahead.
Planning for retirement is about more than making sure that you have enough money, important as the financial foundation is.
Planning for retirement covers more than just financial planning. Planning for retirement is an activity that you and your spouse or partner do together. Your financial planning for retirement is driven by your retirement goals. Here are the basic steps involved.
The first step is self-assessment. The task is to focus on what your needs and desires are. You'll use the results of your self-assessment to set the goals that you want to achieve. These questions may provide a place to start.
Gather information. Once you've completed your self-assessment, the next step is to gather any information you might need in order to set your goals.
Set goals. Next comes setting goals so that you'll be prepared when you retire. For each goal, write a goal statement that identifies who will do what by when. Write down all the actions that are needed to reach the goal. For each action, also list who will do what by when. Being very specific will help you to accomplish the goals.
The last step is to regularly review and update your plans. It's not unusual for goals and plans to change. Even after you've retired, a regular review and reassessment can be fruitful.
The bottom line: Only you know what you want out of your retirement so only you can plan for it.