Systematic planning for retirement is a concept that is somewhat new to our society. In 1900, retirement planning was non-existent. Employers did not offer pension plans, there was no Social Security and the average life expectancy in the U. S. was around 50 years. A century later, everything has changed. Now, more than one million people retire each year at an average age of 63 years and they expect to live to be nearly 85 years old. Current projections suggest that one million or more people who are now in their 40s can expect to live to be 100 or more. With this in mind we can equate the race to retirement to a marathon.

Your 20s / Getting Started In Younger Years

Start early. The general wisdom is that planning your financial future starts with your first job. Even though you will probably have many shorter-term reasons to invest (buying a home) or make payments (buying a car), you should be able to start your retirement plan on a small scale and utilize an Individual Retirement Account (IRA) or employer-sponsored retirement plan. Although you may be diligently paying off student loans or struggling to meet living expenses, the advantages of getting started early on a long-term investment plan are too good to pass up.

Remember to use www.TheMoneyExpert.com 10% Solution strategy to go from paycheck to prosperity: Pay yourself first, before paying any other expenses, by contributing 10% of your gross earnings to a retirement plan. Make the 10% Solution a personal challenge and you will be well on your way to completing the retirement marathon in good time.

Your 30s & 40s / Hitting Your Stride

Most young adults struggle to keep their retirement plan on course during these years. For many, income is stretched on a never-ending list of pressing items related to raising a family -- buying a home, supporting the needs of a growing family or providing for children's anticipated college expenses. During these times, a reduction in contributions to your long-term retirement plan may be necessary. Even so, these investments will be growing, especially if you are building on a portfolio you started in your 20s.

Remember that investing for retirement is also good for your current financial situation: You save on taxes by participating in your employer's salary-reduction plan, your larger investment holdings may help you qualify for a mortgage more easily and you can borrow from some types of retirement investments without incurring taxes or penalties.

Your 40s & 50s / The Wall

At this point in your life, you may be earning more than ever, but you may be spending more, too. Between current (no longer anticipated) college expenses for the kids, expensive little hobbies you have picked up along the way or the inevitable bigger house, you may find yourself struggling to keep up the retirement contributions. On the other hand, for many people, family financial demands may actually start to decline -- mortgage payments may become a lower percentage of income, children may become self-sufficient, you may downsize your lifestyle -- at a time when your salary may be reaching a peak. Therefore, it can be a time to refine your retirement needs, when you may have an opportunity to put more money into your long-term portfolio or possibly start retirement early.

Your 60s and 70s / The Finish Line

Time to start thinking about the transition to retirement living. First and foremost, you must be sure you have enough money to live comfortably. Review all of your possible sources of income and then calculate how much more, if any, you will need to meet your retirement-spending goals. Ensure that you fully understand your pension options from employer-based retirement plans.

Research the places where you may want to live during retirement and list the pros and cons of each. Estimate the moving and living costs. Pay special attention to health care costs and facilities. (This becomes more and more important in retirement.) Finally, dont stop thinking about investing.

Because you can expect to live 20 to 30 years after you retire, continue to invest, even as you begin to collect on your retirement plans. Some financial decisions you will face in retirement are dictated by the government's rules about when and how much you must withdraw from your retirement accounts. Other decisions may be driven by your concerns about personal health care or your desire to leave money to heirs.

Many financial planners use an easy formula to help their clients decide which investments to make: Add a percent sign to your age (69 years old=69%) and have no more than that percentage of your money in fixed income investments like bonds or CDs; the rest should be in stock funds. This is a rule of thumb; we encourage you to call the Investment Hotline for a complete analysis of your investment portfolio. Visit http://www.TheMoneyExpert.com for additional support.

Remember that the Money Movement Strategy is designed for long-term investing, not income production. Therefore, at this time in your life, your portfolio would not be invested in just one type of mutual fund (i.e. stock, bond or money market funds), as it would be earlier in the retirement marathon.

What the Future Holds

The truth is that retirement age is relative to each individual. Many government workers retire after 20 years of service -- sometimes when workers are in their 40s. Some people work well into their 80s, thinking of retirement as "something other people do." Many others retire the first day they are eligible. Still others leave work unwillingly, taking early retirement packages they cannot refuse. But whether retirement is a long way off or sneaking up on you faster than you care to imagine, planning for your financial future is planning for retirement. As with any marathon, determination and a good steady pace are part of a winning formula.

-Anthony Vergopia is a Financial Hotline Educator for http://www.TheMoneyExpert.com.

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