How Do You Want to Live When You Retire?

If you're like most of us, you're giving little consideration to your retirement. After all, when you're busy raising a family, retirement planning seems like it's for old folks -- definitely not us.

Some experts, however, say you should make some room in your daily life for retirement planning-regardless of how old you are. Too many people spend their time saving money, but fail to figure out whether they're able to retire, and what they'll do with themselves when they do, believes Hersh Stern, a Princeton, NJ-based annuity adviser. Most advisers tell their clients whether they're able to retire, based on their finances.

Some things to consider include:

• What are your current expenses and what changes, if any, would you have to consider? For instance, how much more money will you need for travel, sending grandchildren to college or making significant charitable contributions?
• Will either spouse choose to pursue another income-producing job or hobby?
• Have you already addressed health insurance and long-term care?

When you put your dreams and goals on the table first, it's usually easier to become interested in managing your cash and dealing with income taxes. So how do you reach your retirement investing goals?

Start dreaming about it now. Many investment companies have a retirement planning calculators at their websites to help. We suggest ImmediateAnnuities.com, which will provide you independent information from a number of different companies.

The bottom line with all this stuff: Look at the income and expenses you expect to have when you retire. Then make sure the money you have will last. That means the percentage of money you withdraw from your nest egg must be less than the rate of return.

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How can you make your money last longer? In addition to Social Security, pension and investment income, you might consider an immediate annuity, which pays you periodic income for as long as you and your spouse live. But beware. Your annuity income stream is only as strong as the insurance company behind it. Also, unless you make other arrangements, the insurance company may pocket this investment when you die. In some cases you also might consider turning your home into a type of annuity through a reverse mortgage. But with most reverse mortgage programs, you need to be at least 62 years-old to qualify. Information about all of these concerns can be found at ImmediateAnnuities.com and its semi-annual publication, the Annuity Shopper.

Still feeling a little shy of the amount you need to hang up your spikes? You might consider tweaking your hopes and dreams about retirement accordingly.