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Now let's get down to business. Choosing when to retire is an important first step. There's nothing magic about selecting age 35 versus age 65 as the time you will bid adieu to the workforce, but your retirement date is critical to how you will live and survive in retirement. Life expectancies today are increasing. Therefore, someone who retires at the "normal" retirement age of 65 could easily live another 25 to 30 years, or longer. Someone who retires at age 35 can expect to live up to another 55 to 60 years. The big question for both is: How long will each of them live? While we don't know the answer to that, given today's trends we can say it's best to err on the side of caution. To us, age 95 sounds reasonable as a planning assumption. You know how old your parents or grandparents were when they died. Take the highest of their ages and add five or even ten years to it -- that may provide a reasonable, genetically informed, and conservative number to work with. Again, it's your choice.

Once we answer that question, we can begin to set about answering these:

• How much income will you need each year?
  
  
• Where will the income come from?
  
  
• How will that income be protected from the ravages of inflation?
  
  
• How big must the investment pool be to generate that income?
  
  
• What's a safe withdrawal rate from investments to ensure the money lasts as long as we do?

Sound overwhelming? Remember that a journey of a thousand miles begins with a single step. One thing at a time. Let's pick a date.

In the next lesson, we'll be talking about money. Money is the most important practical key to a successful retirement. Certainly there are other issues involved, such as the fulfillment of a life's dream, self-satisfaction, and the pursuit of other activities. But without the cold, hard cash to support us, a successful retirement will be an elusive goal.

We'll also start to get a general picture of what it's going to cost. You may want to begin searching for some important and helpful documents. If you can't find everything, that's cool -- you can always do a little estimating, but the better picture you have of your costs, the better you'll be able to plan. 

• Your checkbook or a year's worth of bank statements, or credit card statements (whichever is your main mode of purchasing) -- this will help you with the all-important "expenses" portion of our equation.
  
  
• Latest pay stub -- What's coming in today? What's going out to the guv'ment in taxes?
  
  
• Last year's income tax return -- Knowing your current tax situation will help you accurately predict your future one.
  
  
• Your investment account statements -- Both your employer-sponsored plan and your individual investment accounts, whether they are IRA or non-IRA accounts. We'll figure out if you're making the most of your long-term savings