Questions that can help you build a retirement funding plan

Planning for retirement begins with deciding the life you want and estimating what it will cost. A few key questions about work, housing, health care and emergencies can help guide a savings strategy.

Your retirement may last 20 years or longer, so it can help to ask yourself what you want that chapter of life to look like.

That question matters because the answer can shape how much you need to save. A good starting point is to decide what you want to do in retirement and then estimate what those choices may cost.

Your answers can help you take the first step toward the retirement lifestyle you hope to reach.

What will I do during retirement?

• Do I plan to keep working after I reach full retirement age? If so, will it be full time or part time?
• Are there hobbies I want to pursue that will cost money or even bring in income?
• Will I volunteer in ways that may still involve expenses?
• Do I want to travel?
• Are there activities I enjoy that come with related costs?
• What does an ideal retirement day look like?

Where will I live in retirement?

• Will I remain in my current home, or will I downsize to a smaller home or rent?
• Will I move to a retirement community or an assisted living facility?
• Would I sell my home and choose an RV or another living arrangement?

What circumstances could affect my retirement expenses?

• What kind of health care coverage do I need for my medical situation?
• Do I have an emergency fund for unexpected events such as a health crisis or property loss from a natural disaster?
• What happens if I stop working earlier than planned?
• What if I face a major drop in income?

What is keeping me from investing?

• I have no extra money to invest.
• I have student loans or other debt.
• I do not know how to begin an investment plan.
• I think I can wait to start saving later.

Next steps

Try to prepare instead of panic. Review the questions above and outline your answers. That outline can become the framework for estimating the income you may need to support the retirement lifestyle you want.

Consider changing your spending habits now. Identify something you truly do not need and redirect that money into a savings or investment account. Over time, you may benefit from the growth potential. Pay yourself first instead of spending on something that will not support your future retirement needs. Building that nest egg now may also reduce money stress.

Begin, or add to, an emergency fund. Even a small amount matters because the first step is what counts. As the balance grows and saving becomes routine, you may gain confidence and momentum in your investing.

Meet with your financial adviser to review your answers and turn your outline into a plan that can help you work toward your goals. An adviser can use planning tools and other resources to help identify your retirement income needs.

Review your plan regularly. Your goals can change over time because of new opportunities or unexpected events. Periodic check-ins can help you measure progress and refine your strategy.

This article was written by Wells Fargo Advisors Financial Network and provided courtesy of Jillian A. Dedic, executive vice president in Owosso, at 989-725-8131.

Investment products and services are offered through Wells Fargo Advisors Financial Network LLC (WFAFN), member SIPC. Parson | Dedic Wealth Management Group is a separate entity from WFAFN.

© Wells Fargo Advisors Financial Network LLC.