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Planning Your Retirement Income
The AARP says life expectancies are now longer than ever–the average American man lives to 75.6 and a woman lives to 80.8. You should prepare to spend much of your life in retirement. To prepare for a comfortable and happy retirement, you have a lot to consider.
Determine Your Retirement Income
You may need just 70 percent of your current income, while others need 85 or even 90 percent of what they live on today.
Begin by assessing what you’ve saved, and use this Retirement Assessment Tool to set reachable goals based on how much monthly income your retirement savings can provide.
Determine Your Retirement Expenses
Start with what you know you are spending today then answer these questions:
- What expenses are taken from your paycheck today? Think health insurance—you may pay this out of your own pocket once you retire.
- Do you have expenses that are likely to increase once you retire, like medical expenses and prescriptions?
- Do you have expenses that might decrease once you retire, like housing, clothing or transportation?
- Have you budgeted for extras like travel and entertainment?
- Have you consulted a tax specialist to estimate your taxes during retirement?
- Have you budgeted for unexpected expenses, like home repairs, new appliances or automobiles?