You’ve spent years putting away money so that, one day, you’ll be able to retire. Now that time is near. What you’ve saved is no longer a nest egg—it’s the source to fund your vision of retirement. And you can turn your savings and investments into a source of steady, monthly retirement income with a detailed income plan.
1. Picture your lifestyle
First, think about the lifestyle you want in retirement.
This includes thinking through how you will spend your time in retirement, where you will live, what is most important to you, what your family will look like, what your preferences are, what concerns you have, etc. Discuss these important topics with your partner to make sure you both have a clear understanding of how you both feel about them and how you prioritize them.
2. Determine your expenses and how much your lifestyle will cost
Some people aim to replace between 70% and 100% of the income they received while working; your exact retirement cash flow needs will depend on your lifestyle goals and personal situation. To get a better estimate, start with a budget worksheet separating essential or everyday expenses from those that are more discretionary—separate the needs from the wants.