Most people think of retirement as a finish line. In actual fact, retirement is a journey. These days, the average retiree is expected to live longer. This leaves one important question you may be asking yourself—will I have enough to live the life I want in retirement?

Here are some tips and strategies which can help you refine your plan and adjust it based on your changing needs.


How would you like to spend your time?

What will an average day in your retirement look like? Perhaps it will consist of leisure activity, extensive travel, or part-time work. For some, it may include a phased approach with early retirement years spent traveling and later years spent close to home.


Once you have a sense of your life in retirement, you can start estimating expenses. While it's impossible to know exactly how much you'll spend, you can get a good sense by looking at current expenses and projecting ahead based on your first few years of retirement.

Consider breaking your expenses into these three categories:


Essential expenses

This includes "must-haves" such as groceries, utilities, transportation and health care.


Discretionary expenses

This category includes "nice-to-haves" such as travel, hobbies, dining out, or purchases like a new vehicle.


Emergency expenses

This includes unexpected events like a leaking roof or an unforeseen health issue. As you plan, you'll want to budget for these types of expenses. A common rule of thumb is to set aside 3–6 months' worth of living expenses.


Once you have an estimate of your expenses, it's time to create a plan. Start by identifying your assets and accounts. You'll then project this income against your expenses to help create an initial plan.


List your assets

Do you own a home or a business? Perhaps you have life insurance, a trust fund, or stock options. If you own rental properties, or expect to receive income from part-time employment, list these as assets as well.



Create your initial plan


Start by categorizing your income as either guaranteed or variable. Guaranteed income would include funds you'll receive on a consistent basis such as Social Security or pensions. Discretionary income would include funds such as personal savings or earnings from a part-time job.

A strong plan combines guaranteed income with flexible income sources to help you offset unexpected expenses. Consider allocating guaranteed income to cover essential expenses and discretionary funds to cover "nice-to-haves."