Retirement Planning

Retirement planning is a term that refers to the allocation of financial resources towards retirement. In most cases this simply means setting aside money or other similar assets for the purposes of collecting a living income once you’re past working age.

But for many Americans, retiring in this new century is a mystery. Earlier generations of workers could rely on employer-provided pensions; many retirees today rely on their own work-related and personal savings plus Social Security benefits. These savings have to last longer because Americans are living longer, often into their eighties and nineties.

But what of the future of Social Security benefits? Will it be there for me, when I am ready to retire? Do I have enough of my own pensions and investments to survive during the retirement years? What do I have to do to be ready when the time comes? These are just a few of the questions you should be asking yourself.

Today’s (and tomorrow’s) retirees may well have a new kind of retirement. With a longer and healthier life span, bikes, boats, planes, and RVs may be part of your life, because you are more likely than previous generations to be an active older American.

The process of putting together plans to retire involves two basic parts. The first part is assessing your readiness to retire given the lifestyle goals you have and the age at which you hope to retire. The second is to come up with possible actions and decisions to improve your readiness and to get closer to your goals. Every action we take as investors through the years are in relation to this recursive process. Ideally, we are always evaluating how ready we are for retirement and how well our plans are proceeding. And making adjustments to these plans and changing the course of our strategies are normal parts of the planning process.

Retirement planning is not something that can be done in a day, a week, or even a month. It is not an event but rather a recursive and cyclical process. The best plans are the ones that provide enough flexibility to allow us to make changes as the need for doing so becomes evident.

Successful implementation and periodic review of your retirement  plan will ensure financial independence through your retirement years.