by Lyndon W

Created on: August 11, 2010

Retirement – the age where you bid goodbye to your bosses and workplace, start on your next phase in life, and survive the remaining of your life on financial nest eggs that you have accumulated earlier. Needless to say, the earlier one retires, the more money is required. However, the big Question that leaves everyone pondering from the first day being in the workforce is probably this: How much saving is enough for retirement? After ascertaining how much is needed, can you then plan how to work towards that target and

build a fortune for retirement.

“only 42% of active workers have ever tried to calculate how much they need… and 8% of those admitted they arrived at their answer by guessing,” reported National Underwriter on April 24, 2006. On hearing this statement, it is frightful, isn't it?

For starters, let's lead ourselves towards some self-questions. What are my retirement goals? What type of lifestyle am I dreaming of? When do I want to retire? One has to be realistic, and only by having answers to the questions earlier can you then provide a more accurate assessment of your retirement needs.

It is never too early to start planning on ensuring sufficient income to last out during your retirement years. The earlier you start, the better prepared you will be, and the more funds will be available for your retirement enjoyment.

How much do you need? A basic rule of thumb is that 50-80 percent of your last drawn annual income before retirement is required to at least adhere to the current lifestyle as before. Translating into hard figures, $80,000 income per annum would mean a financial nest of minimum $40,000 - $64,000 each year after calling it quits. Take careful note of inflation as well and factor it in, the figures should increase over time depending on the current market conditions then.

Let us take a look at expenses next.

Non-existent expenses after retirement. Chances are expenses that were incurred related to work, or others during your working life may no longer be applicable. For instances, commuting costs, meals, work attires, after-work drinking and entertainment sessions will be eliminated. Your kids would most probably be working and surviving on their own, or be done with college by then. Your home loan would most probably be paid in full as well. Without a job, you will now end up in a lower tax bracket. Depending on where you reside, you might even be receiving retirement benefits or pension from your

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