now what do we doThere are many, of course, but prioritizing—not to mention answering—those questions can sometimes seem daunting. In an excellent marketwatch.com piece, Amit Chopra notes “one question I get asked more than any other: ‘Will I ever be able to retire?’  Chopra’s article continues:

“If you’re feeling uncertain about this yourself, that’s understandable. Financial markets seem to get more complex by the day, and a quick glance at the day’s headlines show a global economy rife with question marks and seeming risk. The Employee Benefit Research Institute, a highly respected research outlet, recently released its latest survey on retirement confidence, and the results are bleak: overall retirement confidence is at record lows. So if you’re concerned about how to prepare for your own retirement, you’re not alone.

“Luckily, there are a few things everyone can do to put themselves on a strong footing, and financial advisors can help with the biggest questions you may have.

What you need to do first

“To start, there are a few things that anyone saving for retirement needs to do. First, you should be maxing out contributions to your 401(k) to the best of your ability. If your employer offers any kind of matching program, that should be taken full advantage of.

“Second, everyone — regardless of their net worth — can benefit from setting up and sticking to a budget. Understanding where you spend money, as well as the amount of expenses relative to your income, can reveal where there is further potential to save.

Find an advisor

“Those steps will help but won’t take you the full way. For that, investors should consult with a financial advisor to develop a plan that works for their goals and their abilities. If your advisor doesn’t help develop a strategy for you to retire at the age and in the way that you want, the advisor isn’t doing his or her job.

“A plan should take into account an honest calculation about what one’s retirement plans are and how much money is needed to actualize them. A couple of basic questions everyone should consider are:

  • “What age do you hope to retire?
  • “For how many years would you like your money to last?
  • “When you consider how much you can expect from Social Security, pension, dividends, rental properties and so forth, how much flexibility does that give you?

“Those are obviously difficult questions, ones where the answers are subject to change. But a good rule of thumb is that individuals need 70%-100% of their pre-retirement income to maintain their lifestyle on an annual basis, though this obviously depends on whether you want to travel and whether your home is paid off, factors like that. Cost of living comes into play, as do unexpected expenses like health care, even if estimating the unexpected is difficult.

“But financial advisors can assist with these difficult issues. Something as important as one’s retirement and financial peace of mind can’t be left to chance. People who delay saving or simply put money in the bank and hope for the best do so at their own peril.”