Preparing for retirement

🇺🇸

You should prepare for retirement well in advance of beginning your actual retirement. Navigating the myriad of available information can be a daunting experience. Where should you start?

We often recommend the Bogleheads' Guide to Retirement Planning, along with selections from Book recommendations and reviews and Taylor Larimore's Investment Gems. In addition, a Retirement policy statement can help you lay-out your plans.

Employee Benefits Security Administration
The Employee Benefits Security Administration offers free publications which will point you in the right direction. Use this information as a supplement to information found elsewhere.

In the Retirement section of Publications, the most relevant publications are:
 * Top 10 Ways to Prepare for Retirement
 * Taking The Mystery Out Of Retirement Planning
 * What You Should Know About Your Retirement Plan
 * Retirement Toolkit

Expand the "Publications for Workers and Families" menu to see the reports.

Additional publications:
 * Savings Fitness: A Guide to Your Money and Your Financial Future
 * Women and Retirement Savings

Below are brief overviews of two retirement planning publications.

Top ten ways to prepare for retirement
Below is a brief summary of Top 10 Ways to Prepare for Retirement.

Financial security in retirement does not just happen. It takes planning and commitment and, yes, money.
 * 1) Start saving, keep saving, and stick to your goals
 * 2) Know your retirement needs
 * 3) Contribute to your employer’s retirement savings plan
 * 4) Learn about your employer's pension plan
 * 5) Consider basic investment principles
 * 6) Do not touch your retirement savings
 * 7) Ask your employer to start a plan
 * 8) Put money into an Individual Retirement Account
 * 9) Find out about your Social Security benefits
 * 10) Ask questions

Taking the mystery out of retirement planning
Below is a summary of Taking The Mystery Out Of Retirement Planning.

The Table of Contents:
 * Chapter 1 - Tracking Down Today's Money
 * Chapter 2 - Tracking Down Future Money...At Retirement and After
 * Chapter 3 - Tracking Down Future Expenses
 * Chapter 4 - Comparing Income And Expenses
 * Chapter 5 - Making Your Money Last
 * Chapter 6 - Tracking Down Help For Retirement - Resources

This booklet uses three time periods in charting your retirement savings. The starting point is today, when you are about 50 to 56 years old and plan to work approximately 10 to 15 years more. This is a good time to take stock of where you are in terms of retirement savings and set financial goals you would like to achieve in the 10 to 15-year period you plan to work.

The second point in time is the day you retire, when you are about 65 to 66 years old. That period between now and then is an important one. In those (approximately 10 to 15) years, you will have time to put more of your paycheck to work in a retirement account. It will grow, not only from your additional savings, but also from the “miracle of compounding,” the world's greatest math discovery, according to everyone's favorite genius, Albert Einstein. This is the result of earnings from interest and from investments continually increasing the base amount.

Finally, the third time period used in this booklet is the approximately 30-year span you hope to enjoy retirement. It is the time period experts suggest you plan for, based on the average 65-year old American male living 17 more years and the average 65-year old female living 20 more years. These are only averages, so planning for 30 years will help you avoid outliving your income.

As you read through this booklet, keep an eye on the Timeline for Retirement that follows. Some of the terms, like "catch-up" retirement contributions beginning at age 50, may be new to you. The timeline offers some milestone opportunities to make changes so you can have the kind of retirement you want. The time to start is today.

While the Resources section contains a list of retirement calculators, a companion online worksheet planner to this brochure can found here: Interactive worksheets. You can also find calculators in the wiki here.