Retirement is a significant life change, and one you should consider carefully from all aspects – not just financially. are you emotionally ready to give up the routine of your daily working life and the identity that comes from being associated with your profession? If not, you may want to give more consideration to retirement at this time, or talk to others who have already retired.

Can I afford to retire?
Many experts believe that most people will need 60 – 80% of their current income in order to maintain their current lifestyle in retirement – in today’s dollars. When you factor in inflation, your actual income requirements during retirement will be even higher. Let’s say your current income is $63,000 a year.

To maintain your standard of living after retirement, you’d need 80% of that income, or about $50,000. When you take inflation into account (say 3% annually) in 10 years you’ll need about $67,000 to stay on par with your current level of purchasing power. In 20 years you’d need $90,000.

Determine your retirement goals

Just as you identified your goals and priorities when you set up your financial plan, you’ll need to go through the same process in preparing for retirement. Ask yourself some key questions:

How do I want to spend my retirement?
The opportunities are endless – travel, additional education, volunteering, learning new sports or hobbies. Or you may consider continuing to work – perhaps part-time, either to supplement your income, or simply to stay involved.

Where do I want to live?
This may be a good opportunity to downsize, relocate, or purchase a second home or cottage. Maybe you want to move closer to children and grandchildren.

Do I have family responsibilities?
You may be responsible for supporting elderly parents, dependents, or a disabled spouse. Long-term care insurance, estate planning and the appropriate investments can help you deal with these responsibilities.

Protecting your wealth

You’ve worked hard over the years to save money and build wealth. Protecting that wealth from the risk of disability or failing health is an important part of any retirement plan.

Assessing your need for insurance includes determining your assets, liabilities and risks. Health-care insurance is flexible, but you’ll want to shop around for the best rates and policies to find what best suits you and your situation.

If there’s a risk that the health of either you or your spouse might deteriorate more quickly than that of the other, long-term care insurance might also be something to consider.