Putting a (Rough) Price Tag on Your Dream Kiplinger's (03/01) Vol. 55, No. 3 p.48; Franklin, Mary Beth
The closer a person gets to the time they want to retire, the
more that person needs to take an exact look at how much money they will
need. Because income will be available from different sources at
different times, Kiplinger's magazine recommends knowing exactly where
your retirement money will originate. In addition to knowing the
source(s) of retirement funds, you should also know how much of that
money can be safely withdrawn each year--without running out of funds.
Filling out a worksheet to get a quick overview of a person's retirement
needs, writes Mary Beth Franklin, is paramount. Six steps are required
to complete the early-out worksheet. These steps involve determining
how much income you will need in retirement; how much you will get from
social security and pensions; how big a nest egg you will need; how much
you have already accumulated; how much you will draw from home equity;
and how much more you need to save.