Having a retirement plan is critical if you want to be able to ensure that the funds you’ve allotted for your retirement will be able to fund what you’d like to enjoy during retirement. Basically what you’ll need to do is to evaluate how much income your current retirement assets are projected to provide for you in your retirement years, from there, you’ll have a better handle of the situation and the decisions you may have.
First, if your projected income is less than what you expected, it’s better to know now than after the cake at the retirement party. You have two options when your projected income is less than what you’re likely to spend in retirement: reduce your expenditures or work a little bit longer. The longer you work, the more your assets will grow and the longer and larger you’ll be able to live life as you’ve grown accustomed to. The other alternative has to deal with making personal trade-offs and finding places where you could spend a little less to enjoy the things you can’t dream of giving up.
It’s hard to formulate an end goal if you don’t know where you are right now – writing a retirement plan forces you to get a clear snapshot of your current financial situation and therein lies the power of writing this plan. If you are behind, you will discover it and you will have enough time to be able to react. If you are ahead, you can either keep going on your current path and be satisfied you are doing well or you can siphon off your contributions and enjoy a little bit of it now, knowing full well your retirement is in good hands.
The article from Business Week specifically discusses working with a professional financial planner and while I have never worked with one, it seems very comprehensive and a very valuable article to read if you’re looking to work with a professional on this.
Source: Business Week