2. “Will I have the quality of life I enjoy now?”
You’ve figured out what you’ll need to sustain your current lifestyle after you retire. Now look at the portion of that amount that goes toward your needs or basic expenses, such as housing, utilities, and food.
“Make sure your basic expenses are as low as possible and that they’re covered by fixed income, such as your pension and Social Security,” advises Rita Cheng, a CFP in Bethesda, Maryland.
Then there are what Cheng calls “lifestyle expenses”—those non-basic items such as a kitchen makeover, a new iPad, or that long-dreamed-of trip to Hawaii. To cover these, rely on additional financial resources, such as investment income or part-time work, Cheng advises.