ONE RULE OF THUMB suggests that, to retire in comfort, you need 80% of your preretirement income. Why the 20% drop? You are no longer saving 10% or so every year toward retirement and you’re no longer making an employee’s 7.65% payroll-tax contribution to Social Security and Medicare. In addition, you won’t have to buy work clothes or pay commuting costs. Your income tax bill should also go down, in part because a portion of your retirement income will likely come from Social Security benefits,

IN YOUR 20s, 30s and 40s, you might have invested heavily in stocks because you had a paycheck to cover your living expenses and didn’t need to worry about plunging financial markets. When you retire, you give up that paycheck—and that has big implications for your portfolio. Suddenly, you want not just growth from your investments, but also income.
Later, when we talk about issues facing those age 65 and older, we’ll discuss how you might generate income from your savings while fending off the threat from both short-run market declines and long-run inflation.

ARE YOU ON COURSE for a comfortable retirement? Here’s how to get a quick sense for where you stand:

Add up the savings you have for retirement. Plug this number into the Retirement Planner at Dinkytown.net, along with how much you expect to save in the years ahead and when you expect to retire. Override the default investment returns, inserting 4% as your expected portfolio performance and 2% for inflation. Take the sum you’ll have at retirement and divide by 25.

WE SPEND DECADES saving for retirement, but we often give scant thought to what we’ll do with all that free time. This can be a huge mistake.
We might imagine that what we want is more time to relax. But we aren’t built to relax. Rather, thanks to our hunter-gatherer ancestors, we’re built to strive. We are here today because they never let up in their quest for survival. Result: We’re often happiest when engaged in activities that we think are important,

YOU ARE SAVING diligently for retirement—but where should you invest those savings? You’ll want to give careful thought to your so-called asset allocation, which is your basic mix of stocks, bonds and other investments. You will also want to consider whether to stash your savings in a taxable account, your employer’s 401(k), a Roth IRA, a health savings account or elsewhere. You can get detailed help with these two issues in the chapters devoted to investing and taxes.

AS A RULE OF THUMB, you should probably save 12% to 15% of your pretax income toward retirement. If your employer has some sort of traditional defined benefit pension plan, which will pay you income every month in retirement, you can likely save less.
Similarly, if your employer makes a fixed or matching contribution to its 401(k) or 403(b) plan, you might be able to trim your savings rate. Suppose your employer matches your 401(k) contributions at 50 cents on the dollar up to 6% of pay.

OUR HUNTER-GATHERER ancestors were focused on surviving until tomorrow. We need to focus on retiring decades from now. Not surprisingly, this isn’t something that comes naturally.
Often, our inclination is to deal with life’s goals consecutively, rather than concurrently. In other words, we might save for the house down payment in our 30s, pay for the kids’ college in our 40s and then finally turn our attention to retirement in our 50s. But if we do that,

IF AMASSING ENOUGH savings to retire is life’s toughest financial task, managing that money in retirement is the trickiest. Consider the juggling act ahead: You need your money to last at least as long as you do, while fending off the threat from long-run inflation and short-term market declines. You also need to be prepared for unexpected expenses—and perhaps the biggest is long-term care, which we discuss in the safety net chapter.
No single financial product will accomplish all of these tasks.

IF YOU’RE WITHIN 10 or 15 years of retirement, the financial “to do” list can be daunting. This is your last chance to use the income from your human capital to prep your finances for life without a paycheck.
Between now and retirement, you probably want to save as much as you can and get all debt paid off. You need to decide whether to stay in your current home and, if you’ll move,

MOST OF US HAVE all kinds of financial desires, including a nice home, a fancy car, a good education for the kids and a fun trip next summer. But retirement should take precedence, even in our 20s.
Think of it this way: You can take out a loan to buy a house or car, and your kids can borrow to pay for college, and then slowly pay the money back. But when it comes to retirement,

WALL STREET FIRMS often direct marketing pitches at women, claiming that they have distinct financial needs. But in truth, women’s financial needs aren’t all that different from those of men, though there are five differences that are worth bearing in mind as you save and invest for retirement. First, women typically live longer than men, so it’s helpful if you have a somewhat larger nest egg and it can make even more sense to delay Social Security benefits to get a larger monthly check.

EXPERTS SOMETIMES talk about the three-legged retirement stool, consisting of Social Security, traditional defined benefit pension plans and personal savings. The latter includes money stashed in 401(k) plans, individual retirement accounts and regular taxable accounts.
Cutting Social Security is a constant topic of conversation in political circles, though lately there’s also been talk of increasing benefits. Even without any changes, benefits are getting scaled back. The age at which retirees can claim full Social Security retirement benefits is gradually climbing.

WHAT’S THE STATE of America’s retirement readiness? Here’s a quick look at some worrisome statistics—as well as some key notions that should concern both those saving for retirement and those who have already quit the workforce:

You can get a glimpse of America’s retirement readiness from the Federal Reserve’s 2022 Survey of Consumer Finances. Among households headed by someone age 65 to 74, 76.1% owned their home, down from 85.8% nine years earlier. Moreover,

ARE YOU NAMED AS executor of an estate? Here are some steps you’ll likely need to take:
Hire an attorney. Don’t feel compelled to use the deceased’s lawyer, especially if he or she doesn’t specialize in settling estates. A lawyer might charge a flat fee, a percentage of the estate’s gross value or by the hour. Try to avoid an hourly fee, because it’s hard to know what you will end up getting charged.

DEATH IS OFTEN accompanied by a slew of practical details. Where to begin?
Look for funeral instructions. You may discover they’re in the deceased’s will or letter of last instruction.
Consider the cost. This is hardly the moment when most folks are up for comparison shopping, and yet it pays to keep your wits about you. Funeral homes often nudge families to spend more than is necessary.