The hardest calculation a person has to make when considering options for retirement is also one of the most important: How long do you think you'll live?
It's also one of the most difficult, but to most financial planning professionals it's just one of many factors to look at when retirement is being considered.
"There's not a specific formula because there are so many moving parts,"
"if you come from a family with shorter life expectancy than the norm, that's a factor. That can also impact when you take Social Security. Maybe in that scenario you might want to take it at retirement age rather than waiting a few years to get full benefit at age 70.
"Another factor is your lifestyle and your budget. A lot of people ask how much you want or how much you would need to live on once you retire.
"Surprisingly there are plenty of people who will need close to 100% of their pre-retirement income even after retirement, for a variety of reasons."
So as you can see there are no formulas that work for everyone, but there are basic calculations that one can make, he says.
Perhaps the most important is, What do you want to do after retirement? Some people worked for many years and never got to travel the way they wanted to do, so in retirement they want to travel the world. It would be common sense to say that such people will likely need that about-100% of pre-retirement income.