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Planning for retirement can feel overwhelming, especially if you’re focused on your career, family or going back to school. Having a plan, however, is important. Here, we explore how to leverage savings, benefits and strategy to create a plan for retirement.

Everyone’s plan for retirement will look different. Some may want to travel or relocate, while others may plan to stay close to home and spend time with family. The first step is to understand your financial picture: income, expenses, debt and financial goals.

If your immediate concerns are not met, you may get derailed with saving for your long-term goals. That’s why it’s smart to get your finances for the present in order as much as possible. If you have a stable income and little to no debt, for example, consider starting with an emergency fund that can cover three to six months of living expenses. Once you’ve built that up, you’ll be in the habit of saving and you’ll also enjoy peace of mind in the event of unexpected expenses.

When you’re ready to start saving for retirement, it helps to have a ballpark idea of what you’ll need to be able to live comfortably. Generally speaking, an ideal retirement savings goal is to be able to maintain at least 80% of your prior annual income. That means you’ll need an annual income for the rest of your life that totals at least 80% of what you make now. Of course, you may need more or less than that depending on your lifestyle, location, health needs and other personal factors. Also, don’t forget to account for inflation, healthcare costs and major life events like the death of a spouse or the arrival of grandchildren.

According to , the average 401(k) balance for individuals ages 55 to 64 was around $244,750. While that might sound like a solid amount, it may not be enough if it’s your only source of retirement savings. This is why it’s important to do a deep dive into your as a retiree and create a plan ahead of time.

So, what should you consider when building your plan for retirement? Here are some common ways to save.

Some employers offer 401(k) plans with company matches, meaning the company will match up to a certain amount of your contributions. If your employer offers a match, it may be wise to contribute enough to get the full benefit as it allows you to save more faster. These accounts also offer tax advantages and can grow substantially over time through compounding interest.

This account allows you to contribute pretax dollars, potentially lowering your taxable income in the year you contribute. For example, if you earn $50,000 and contribute $5,000, you’ll be taxed on $45,000. 

For those who meet eligibility requirements, Roth IRAs are funded with after-tax income and don’t offer a tax break up front, but your withdrawals in retirement will be tax-free—including any money earned from investment growth and compounding interest. This is a powerful option for younger savers or anyone expecting to be in a higher tax bracket later. 

Ideal for self-employed individuals or freelancers, SEP IRAs allow higher annual contributions and also grow tax-deferred, meaning you don’t pay tax on the income you contribute toward your SEP IRA, but you do pay taxes on the money when you withdraw it in retirement. They’re typically considered simple to manage and a strong alternative to traditional workplace plans.

Remember, starting your plan for retirement early and leveraging these tools can potentially maximize growth through compound interest, even if you're contributing small amounts.

Many retirees rely on Social Security for part of their income during retirement — but it’s designed to replace only about 40% of your pre-retirement income. That’s why it’s important to build additional savings through IRAs, 401(k)s and other income sources.

Your Social Security benefit is calculated based on your 35 highest-earning years. If you haven’t worked for 35 years, years with zero income are factored in, potentially reducing your benefit.

You can start receiving benefits at age 62, but the amount will be permanently reduced. If you wait until full retirement age (66 or 67, depending on your birth year), you'll receive your full benefit. Waiting until age 70 can increase your benefit even more. The right time to claim depends on your health, life expectancy and personal financial situation.

Check your estimated benefits at to better understand what you can expect.

Retirement income doesn’t just come from savings accounts and investments. Here are other potential sources to consider in your plan for retirement:

Pensions offer guaranteed income based on salary and years of service. As of 2023, only 19% of workers were reported as enrolled in this type of plan.

An annuity is a contract between an insurance company and you whereby you pay a sum and are guaranteed a payment every month for at least a year. Some annuities pay out for the rest of one’s life, others for an established period of time. That amount can also vary each month or be fixed, depending on the type of annuity. This option can offer consistent income during retirement.

Stocks, bonds and mutual funds can offer long-term growth. Though they carry risk, they can also provide a way to increase retirement income.

Whether selling a property or earning rental income, real estate can diversify your income. Just keep in mind the potential need (and expense!) for ongoing management.

Healthcare can become a major expense during retirement. Even with Medicare, you may need supplemental insurance for out-of-pocket costs, prescriptions, dental care or long-term care.

If eligible, consider contributing to a health savings account (HSA), which allows tax-free savings for qualified medical expenses. Long-term care insurance is another option to help protect your savings from unexpected medical costs.

Even if retirement feels far off, it’s important to start to plan for retirement today. Here are a few steps you can take:

• Automate your retirement savings
• Review your employer’s retirement plan to ensure you’re getting the most out of it
• Use an online calculator to estimate your retirement needs
• Adjust your monthly budget to prioritize savings
• Open a traditional or Roth IRA if you don’t have a 401(k)

Small, consistent actions can build momentum. You don’t need to do everything at once — just begin where you are.

When you start to plan for retirement, keep in mind that retiring is more than leaving work; it’s about gaining financial independence and the freedom to live life on your terms. Whether you dream of traveling, pursuing hobbies or even starting a second career, a well-thought-out retirement plan can help you begin that journey.

Curious about other personal finance topics like budgeting and managing credit card debt? Check out the webinars offered by ������ý!

All financial decisions, including investments, should be made carefully and potentially with the guidance of a financial planning professional.