Until you hit your 50s, retirement seems like a far-off fantasy. Planning for something that's decades away almost feels foolish -- like you're putting money someplace you may never use it.

That's a risk, of course. You could save diligently through all your working years, sock away a big retirement nest egg, and then get hit by a bus on the way to your retirement party. It's possible you could get eaten by a bear at 40 or swarmed by killer bees in your 50s.

The reality is, though, that most Americans will make it to retirement age. Life expectancy in the U.S. in 2019 sits at 76 for men and 81 for women. Chances are, you will need to have money put away for retirement. And, even if you plan to never stop working, health problems may force your hand, so while planning for the future may seem a bit silly, it's really important.

A sheet of paper next to a typewriter says retirement plan.

The new year is a smart time to examine where you stand in your retirement planning. Image source: Getty Images.

Where do your assets stand?

The new year is a logical time to take stock of your assets. Your need and urgency vary based on your age. If you're 25, then you still need to know where you stand, but you have plenty of time to make major course corrections. Once you hit 40 or so, it's more urgent to ensure you're making the right moves and planning adequately for your eventual retirement.

It's important to take stock of where you stand. This list may not cover everything, but it hits the major financial bullet points:

  • How much non-mortgage debt do you have (credit cards, car loans, student loans, etc.)?
  • What assets do you have readily available (like a checking or savings account)?
  • What is your mortgage balance and home equity?
    • It's also useful to know when your mortgage will be paid off in full.
  • What do you have in retirement savings?
    • 401(k)? Employer pension? Government pension? IRA? Stocks? Bonds?
  • Are there any other major financial factors you should consider?
    • Are you paying for kids to go to college?
    • D you have any potential medical issues?
  • How much are you adding each month to your retirement savings?

Some of these questions have clear answers, while others may be up in the air. For example, your child may earn a scholarship or elect to go to an expensive private school versus a cheaper state one. That should not stop you from doing the best calculation you can to see where you stand, how much you have now, and where you might be when you hit your mid-60s.

How much do I need to retire?

There's no specific answer to the question "How much do I need to retire?" Your calculation will depend upon how much you plan to spend in retirement. That's predicated on a number of choices, including where you would like to live and what type of life you want.

A retirement filled with travel and expensive hobbies costs more than one where you move someplace cheaper and live a home-based life. You may not know exactly how you want to live in retirement even when you hit your 50s, and you most certainly would just be guessing if you're even younger.

Because of that, it makes sense to plan to have as much money as possible. Having more cash socked away in your retirement accounts opens up more options when it comes time to retire. 

Many people use an 80% guideline -- meaning that if you made $100,000 a year while working, you will want to have $80,000 per year in retirement. That calculation can vary a lot -- and exactly how much you need depends upon how long you plan to live -- but it's a starting point.