Retirement planning is not a single decision made late in life — it is a multi-decade process that rewards early action, disciplined saving, and periodic course correction. As a Certified Financial Planner with more than 14 years of guiding households through this journey, I have watched families with modest incomes retire comfortably because they followed a structured plan, and I have watched high earners arrive at age 60 with nothing but home equity and anxiety. The framework below distills that experience into nine concrete steps you can take at any age. Each step includes real dollar thresholds, 2024 contribution limits, and decision frameworks you can apply this week. Whether you are 25 with your first 401(k) or 55 staring down a shortfall, the same principles apply — only the urgency changes.
Why a Step-by-Step Approach Beats Guesswork
The Federal Reserve's 2023 Survey of Consumer Finances found that the median retirement account balance for working-age families was just $87,000, while the average was $335,000 — a gap that reveals how unevenly prepared Americans are. Most of that disparity comes down to process, not income. Households that follow a written plan save at roughly twice the rate of those who improvise, according to research from the Employee Benefit Research Institute (EBRI). A step-by-step plan also reduces decision fatigue, which is the silent killer of long-term wealth because every "I'll figure it out later" compounds into a smaller portfolio decades later. The nine steps below are sequenced for maximum leverage: earlier steps unlock the dollar amounts that make later steps matter, so do not skip ahead even if a later step feels more interesting.
The 9-Step Retirement Planning Framework at a Glance
Before diving into each step, here is the complete framework so you can see how the pieces fit together. Each step builds on the prior one, and skipping a step — particularly the early ones on goals and accounts — typically costs households between $100,000 and $500,000 over a working lifetime. I have audited hundreds of retirement plans over my career, and the gap between optimized and improvised plans is almost always in that range. Print this list, pin it somewhere visible, and revisit it every January during your annual review.
- Calculate your retirement number using the 25x rule and replacement rate.
- Capture the full employer 401(k) match — it is a 100% immediate return.
- Choose the right mix of tax-advantaged accounts for your income and stage.
- Build an age-appropriate asset allocation using a glide path.
- Optimize Social Security claiming age for lifetime benefits.
- Plan for healthcare, including Medicare gaps and long-term care.
- Diversify across tax buckets: taxable, tax-deferred, and tax-free.
- Set up basic estate documents: will, beneficiary designations, POA.
- Conduct an annual review and rebalance to your target allocation.
Step 1: Calculate Your Retirement Number
The first step is converting a vague goal like "comfortable retirement" into a specific dollar amount you can plan toward. Two methods work well together: the income replacement rate and the 25x expense rule. Vanguard research suggests most households need 75% to 85% of pre-retirement income to maintain their standard of living, but the right number depends heavily on lifestyle, housing status, and whether you will have a pension. The 25x rule, derived from the 4% safe withdrawal rate that originated with Bill Bengen's 1994 research, says you need 25 times your expected annual retirement expenses saved in investable assets. Both methods give similar answers when applied carefully, and using both as a cross-check prevents the most common planning error — underestimating how much you actually need.
Income Replacement Rate by Lifestyle
Your replacement rate is the percentage of pre-retirement income you will need in retirement. Lower-income households need a higher percentage because a larger share goes to essentials, while higher earners can often live on less because they were saving more pre-retirement. The table below reflects Bureau of Labor Statistics Consumer Expenditure Survey data blended with Vanguard's target-date fund assumptions. Use it as a starting point, then adjust based on whether your mortgage will be paid off, whether you plan to downsize, and your expected travel or healthcare spending.
| Pre-Retirement Income | Lifestyle Category | Replacement Rate | Annual Income Needed |
|---|---|---|---|
| $40,000 | Essentials-focused | 85% | $34,000 |
| $60,000 | Moderate | 80% | $48,000 |
| $80,000 | Comfortable | 75% | $60,000 |
| $120,000 | Upper-middle | 70% | $84,000 |
| $200,000 | Affluent | 65% | $130,000 |
| $300,000+ | High-earner | 55-60% | $165,000-$180,000 |
The 25x Expense Rule: How Much You Need Saved
The 25x rule is simpler to apply than the replacement rate because it focuses on spending rather than income, which is what actually matters in retirement. Estimate your annual retirement expenses, subtract expected Social Security and any pension income, and multiply the gap by 25. The result is your target investable asset balance. The table below shows the math at common spending levels assuming $30,000 in annual Social Security benefits for a couple and $0 pension income. Use our compound interest calculator to project how your current savings will grow toward this target.
| Annual Retirement Spending | Less Social Security | Annual Gap | Target Savings (25x) |
|---|---|---|---|
| $40,000 | $30,000 | $10,000 | $250,000 |
| $60,000 | $30,000 | $30,000 | $750,000 |
| $80,000 | $30,000 | $50,000 | $1,250,000 |
| $100,000 | $30,000 | $70,000 | $1,750,000 |
| $120,000 | $30,000 | $90,000 | $2,250,000 |
| $150,000 | $30,000 | $120,000 | $3,000,000 |
Step 2: Capture the Full Employer Match
If your employer offers a 401(k) match, contributing enough to capture all of it is the single highest-return action in personal finance. A typical match is 50% of contributions up to 6% of salary, which is an immediate 50% return — far better than any investment you will ever make in the market. Fidelity's 2024 analysis shows that approximately 1 in 5 workers do not contribute enough to get the full match, leaving an average of $1,800 of free money on the table each year. Over a 30-year career at 7% returns, that annual $1,800 grows to roughly $170,000 — a staggering cost for inaction. Before optimizing anything else, log into your 401(k) portal and confirm your contribution rate captures the full employer match.
Step 3: Choose the Right Accounts
Once the match is captured, the question becomes which account to fund next. The 2024 contribution limits below reflect IRS inflation adjustments and shape how much you can shelter from taxes each year. Workers aged 50 and over qualify for catch-up contributions, which add significant tax-advantaged space for late-career savers. The choice between traditional and Roth versions depends on your current marginal tax rate versus your expected retirement tax rate — a framework we cover in detail in step 7.
| Account Type | 2024 Limit | Catch-Up (50+) | Total Limit (50+) |
|---|---|---|---|
| 401(k) / 403(b) | $23,000 | $7,500 | $30,500 |
| Traditional / Roth IRA | $7,000 | $1,000 | $8,000 |
| SEP IRA | $69,000 | $7,500 | $76,500 |
| SIMPLE IRA | $16,000 | $3,500 | $19,500 |
| HSA (self / family) | $4,150 / $8,300 | $1,000 | $5,150 / $9,300 |
| 457(b) Governmental | $23,000 | $7,500 | $30,500 |
Marcus, a software engineer earning $110,000, had been contributing 3% to his 401(k) for four years while his employer matched 50% up to 6%. He was leaving $1,650 of free money on the table annually. When I increased his contribution rate to 6%, his total annual contribution rose from $3,300 to $9,900 ($6,600 from him plus $3,300 match). His take-home pay dropped only $128 per paycheck because of the tax savings. Projected at 7% returns to age 65, the additional $6,600 per year grows to roughly $640,000 — turning a small behavioral change into a six-figure retirement outcome. Marcus's case illustrates why the match is always step two, never step five.
Step 4: Build an Age-Appropriate Asset Allocation
Asset allocation — the split between stocks, bonds, and cash — explains roughly 90% of a portfolio's long-term return variance according to the landmark 1986 Brinson study that Vanguard still cites. The right allocation depends on your age, risk tolerance, and time horizon, but a glide path framework gives you a defensible starting point. Younger investors can afford a heavy equity tilt because they have decades to recover from market drawdowns, while those near retirement need more bonds to dampen sequence-of-returns risk. The table below is a simplified version of what target-date funds use, adjusted slightly more conservative than industry defaults because I have seen too many near-retirees panic-sell in 2008 and 2020.
| Age | Stocks | Bonds | Cash / Short-Term | Rationale |
|---|---|---|---|---|
| 20s | 90% | 10% | 0% | Maximum growth, longest time horizon |
| 30s | 85% | 15% | 0% | Slight derisk, still growth-tilted |
| 40s | 75% | 20% | 5% | Balanced growth with stability layer |
| 50s | 65% | 30% | 5% | Capital preservation begins |
| 60s | 55% | 35% | 10% | Pre-retirement buffer building |
| 65+ | 50% | 40% | 10% | Retirement stability with growth hedge |
Step 5: Optimize Social Security Claiming
Social Security is the closest thing to a guaranteed, inflation-adjusted annuity most Americans will ever have, and the age at which you claim dramatically affects lifetime benefits. Claiming at 62 reduces your monthly benefit by up to 30% compared to your full retirement age, while delaying to 70 increases it by 24% to 32% above full retirement age. For a worker with a $2,000 primary insurance amount at full retirement age 67, the lifetime difference between claiming at 62 versus 70 is roughly $250,000 for someone living to 85. The break-even age — the point at which delaying beats claiming early — typically falls around age 80, so longevity expectations should drive your decision. Married couples have additional optimization options via spousal and survivor benefits that can add tens of thousands of dollars in lifetime value.
| Claiming Age | Monthly Benefit* | Annual Benefit | Lifetime to Age 85 | vs. Claiming at 62 |
|---|---|---|---|---|
| 62 (early) | $1,400 | $16,800 | $386,400 | — |
| 64 | $1,600 | $19,200 | $403,200 | +$16,800 |
| 67 (FRA) | $2,000 | $24,000 | $432,000 | +$45,600 |
| 68 | $2,160 | $25,920 | $440,640 | +$54,240 |
| 70 (max) | $2,480 | $29,760 | $446,400 | +$60,000 |
*Based on a $2,000 primary insurance amount at full retirement age 67. Actual benefits vary based on earnings history.
Raj and Anita Patel had planned to both claim Social Security at 62 to "get what's coming to them." I modeled three alternatives and showed them the lifetime difference. Their combined primary insurance amounts were $2,400 (Raj) and $1,400 (Anita). By having Raj delay to 70 while Anita claimed spousal benefits at 67, their combined lifetime benefits to age 88 increased from approximately $920,000 to $1.18 million — a $260,000 improvement funded entirely by patience and the spousal claiming rule. The Patels used taxable bridge savings to cover the gap years between 62 and 70. This case shows why Social Security optimization is not optional for married couples — it is a six-figure decision.
Step 6: Plan for Healthcare Costs
Healthcare is the most underestimated retirement expense, and Fidelity's 2024 Retiree Health Care Cost Estimate puts the average 65-year-old couple's lifetime healthcare costs at $165,000 in today's dollars — and that figure excludes long-term care. Medicare does not cover everything: Part B premiums ($174.70 per month in 2024 for most retirees), Part D drug coverage, Medigap or Medicare Advantage premiums, dental, vision, and hearing all add up. Long-term care — which Medicare largely does not cover — averages $90,000 to $116,000 per year for a private nursing home room according to Genworth's 2023 Cost of Care Survey. Couples should budget $300,000 to $400,000 for healthcare alone in a 30-year retirement, and that is before considering long-term care insurance or self-insuring.
Step 7: Diversify Across Tax Buckets
Tax diversification is the strategy of holding assets across three buckets: tax-deferred (traditional 401(k) and IRA), tax-free (Roth accounts and HSA), and taxable (brokerage accounts). Each bucket has different rules for withdrawals, required minimum distributions, and tax rates, so holding all three gives you flexibility to manage your tax bill in retirement. A retiree with $500,000 in each bucket can mix withdrawals to stay in a low tax bracket, manage Medicare IRMAA surcharges, and avoid the tax torpedo where Social Security becomes suddenly more taxed. The traditional versus Roth decision comes down to comparing your current marginal tax rate with your expected retirement marginal tax rate — if you expect to be in a lower bracket in retirement, favor traditional; if higher, favor Roth. Most workers are best served by a mix rather than an all-or-nothing approach.
Step 8: Set Up Basic Estate Documents
Estate planning is not just for the wealthy — it is how you ensure your wishes are honored and your family is spared legal headaches if you become incapacitated or die. The five documents every adult should have are a will, durable power of attorney, healthcare proxy, living will (advance directive), and updated beneficiary designations on all retirement and life insurance accounts. Beneficiary designations override your will, so a stale 401(k) form naming an ex-spouse will defeat your current intentions — a problem I have seen cause significant family conflict. For households with over $500,000 in assets or minor children, a revocable living trust may also make sense to avoid probate. Total cost for a basic estate plan typically runs $1,500 to $3,500 with an attorney, or $300 to $600 using a reputable online service like Trust & Will.
Step 9: Conduct an Annual Review
The final step is the one that keeps all the others working — an annual review conducted each January or on a fixed date you will not forget. During the review, rebalance your portfolio back to your target allocation, update your contribution rates to reflect any salary increases, verify your beneficiary designations, and re-run your retirement number with updated expense projections. Rebalancing matters because portfolios drift: a 60/40 portfolio left untouched for a decade during a bull market can easily become 80/20, taking on far more risk than you intended. The annual review also catches life changes — marriage, divorce, children, inheritance, job changes — that should trigger updates to your plan. Spending two hours a year on this review is the highest-ROI time you will invest in your financial life.
Susan, a divorced teacher earning $72,000, had only $48,000 saved for retirement when she came to me at age 52. We built a catch-up plan using her 403(b), a Roth IRA, and the 50+ catch-up contributions now available to her. Her total annual savings capacity was $30,500 in the 403(b) plus $8,000 in the Roth IRA, for a combined $38,500 per year. By saving aggressively — including redirecting a recent raise and a small inheritance — Susan projected $385,000 by age 65 at 6.5% returns, which combined with Social Security and a small pension would support her $50,000 annual spending target. The lesson: starting late is not fatal, but it requires both higher savings rates and realistic spending expectations.
Myth vs Fact: Common Retirement Planning Misconceptions
Myth: "I can always catch up later when I'm earning more."
Reality: The math of compounding punishes delay severely. A worker saving $5,000 per year from age 25 to 35 and then stopping accumulates more by age 65 than a worker saving $5,000 per year from age 35 to 65, assuming equal 8% returns. The early saver contributes $50,000 total and ends with roughly $787,000; the late saver contributes $150,000 and ends with roughly $611,000. Time in the market matters more than money in the market, and no future salary increase can buy back the lost decade of compounding.
Myth: "Social Security will be gone by the time I retire."
Reality: The 2024 Social Security Trustees Report projects the combined trust fund will be depleted in 2035, at which point payroll taxes would still cover approximately 83% of scheduled benefits. Congress has multiple levers — raising the payroll tax cap, adjusting the full retirement age, means-testing benefits — and historical precedent suggests benefits will not be cut for current retirees or near-retirees. Plan for roughly 75% to 85% of your projected benefit as a conservative assumption, but do not plan for zero.
Myth: "I need to pay off my mortgage before I retire."
Reality: Paying off a low-rate mortgage (3% to 4%) while neglecting tax-advantaged retirement contributions is a common and costly mistake. Long-term market returns have historically averaged 9% to 10%, so the opportunity cost of prepaying a 3.5% mortgage can exceed 5% per year. A better approach is to max out tax-advantaged accounts first, then direct any surplus toward mortgage prepayment if the psychological benefit matters to you. Many retirees are better off keeping the mortgage for the liquidity and tax deduction.
Myth: "A financial advisor is too expensive for someone my age."
Reality: A flat-fee or hourly advisor typically charges $200 to $400 per hour or $2,000 to $5,000 for a comprehensive plan, and a single session can pay for itself many times over by optimizing your savings rate, account choices, and asset allocation. Vanguard'sAdvisor's Alpha research estimates that good advice adds roughly 3% per year in net returns through behavioral coaching, tax optimization, and asset location. The question is not whether advice costs money — it is whether the advisor is fee-only, fiduciary, and adding value beyond what you could do yourself.
Myth: "I will spend less in retirement than I do now."
Reality: Spending often stays flat or even rises in early retirement due to travel, hobbies, and healthcare, then declines in the late "go-go" years before rising again with healthcare at the end. BLS data shows retirees aged 65 to 74 spend approximately 80% of pre-retirement spending, but those 75+ spend about 65%. Early retirement is when spending peaks for most people, so plan for that decade to be the most expensive. Underestimating the first ten years is a primary cause of premature portfolio depletion.
Myth: "Target-date funds are too conservative."
Reality: Modern target-date funds use glide paths that maintain meaningful equity exposure well into retirement — Vanguard's 2025 fund still holds approximately 55% stocks at the target date, declining to 30% by seven years after. The perception of over-conservatism comes from older glide paths or from investors who only glance at the bond allocation. If you prefer a more aggressive path, choose a fund dated 10 to 15 years later than your actual retirement year, which keeps equity exposure higher for longer.
Myth: "I should stop contributing to retirement accounts to pay for my kids' college."
Reality: Your child can borrow for college; you cannot borrow for retirement. Financial aid formulas do not count retirement assets, so saving for retirement actually improves aid eligibility, while large taxable accounts reduce it. The 529 plan is a powerful college savings vehicle, but it should be funded only after your retirement accounts are on track. Most financial planners recommend prioritizing retirement at least 2:1 over college savings until you are clearly ahead of your retirement trajectory.
Decision Framework: Where to Direct Your Next Dollar
Once you have completed the nine steps above, the ongoing question becomes where to direct each additional dollar of savings. The framework below is the funding order I recommend for the majority of working households, though individual circumstances — particularly high-income earners facing Roth IRA income limits — may warrant adjustment. Work your way down the list, fully funding each tier before moving to the next. This order maximizes employer benefits, tax advantages, and flexibility, in that sequence.
| Priority | Account | Amount to Fund | Why |
|---|---|---|---|
| 1 | 401(k) to employer match | Up to 6% of salary (typical) | 100% immediate return on match |
| 2 | HSA (if eligible) | $4,150 / $8,300 (2024) | Triple tax advantage, investable balance |
| 3 | Roth or Traditional IRA | $7,000 / $8,000 (50+) | Flexibility, broader investment options |
| 4 | 401(k) to annual max | $23,000 / $30,500 (50+) | Large tax-deferred capacity |
| 5 | Taxable brokerage | Unlimited | Flexibility, no withdrawal restrictions |
| 6 | 529 college plan | Varies by state limit | Tax-free growth for education |
| 7 | Extra mortgage payoff | Surplus only | Guaranteed return equal to rate |
Frequently Asked Questions
1. How much should I have saved for retirement by age 30, 40, 50, and 60?
Fidelity's age-based benchmarks suggest having 1x your salary saved by age 30, 3x by 40, 6x by 50, and 8x by 60, reaching 10x by 67. These benchmarks assume you started saving 15% of income at age 25 and retire at 67, so adjust upward if you started later. They are guides, not gospel — a more precise measure is your personalized retirement number from Step 1. If you are behind, increase your savings rate by 1% to 2% per year rather than trying to close the gap all at once.
2. What is the 4% rule and is it still safe?
The 4% rule, derived from Bill Bengen's 1994 research, states that withdrawing 4% of your initial portfolio value in year one and adjusting for inflation annually provides a high probability of not running out of money over 30 years. Recent research by Morningstar suggests 3.3% to 3.7% may be more appropriate given current bond yields and equity valuations. The rule is a starting point for planning, not a guarantee, and should be adjusted based on your asset allocation, retirement length, and market conditions in the early retirement years.
3. Should I contribute to a traditional or Roth 401(k)?
The decision hinges on your current marginal tax rate versus your expected retirement marginal tax rate. If you expect to be in a lower bracket in retirement, choose traditional and take the deduction now. If you expect to be in a higher bracket — common for young workers early in their careers or those expecting significant pension income — choose Roth. Workers in the 24% bracket or higher today usually benefit from traditional; those in the 12% or 22% bracket often benefit from Roth. A split between the two provides valuable tax diversification.
4. How do I know if I am on track for retirement?
Run a retirement projection annually using a calculator or a financial planner's tool, comparing your projected balance at retirement with your target from the 25x rule. The projection should account for current savings, expected contributions, estimated returns (use 6% to 7% conservatively), and inflation. If your projected balance is within 10% of your target, you are on track; if it is below, increase your savings rate, extend your retirement age, or reduce your spending target. Stress-test the projection with bear-market scenarios to see how sequence risk affects you.
5. Can I retire early and still access my retirement accounts?
Yes, through several strategies. The Rule of 55 allows penalty-free withdrawals from your current employer's 401(k) if you leave your job at age 55 or later. Substantially Equal Periodic Payments (SEPP), also called 72(t) distributions, allow penalty-free withdrawals from IRAs at any age based on your life expectancy. Roth IRA contributions (but not earnings) can be withdrawn at any time without tax or penalty. The taxable brokerage account has no withdrawal restrictions, which is why early retirees typically build a "bridge" portfolio to fund years before age 59½.
6. How does inflation affect retirement planning?
Inflation erodes purchasing power significantly over a 30-year retirement — at 3% inflation, $100,000 of spending power becomes roughly $41,000 after 30 years. This is why retirement projections should use real (inflation-adjusted) returns rather than nominal returns, and why Social Security's cost-of-living adjustments are so valuable. Holding some equities in retirement provides growth that outpaces inflation, while TIPS and I bonds offer explicit inflation protection. Plan for healthcare inflation specifically, which has historically run 2 to 3 percentage points above general inflation.
7. What happens if I outlive my retirement savings?
Outliving your savings is called longevity risk, and it is the single biggest financial fear retirees report. Mitigation strategies include delaying Social Security to maximize the inflation-adjusted annuity, considering a single-premium immediate annuity for basic expenses, holding a more conservative withdrawal rate (3.5% rather than 4%), and building a cash reserve equal to 1 to 2 years of expenses to avoid selling in downturns. Long-term care insurance also protects against the catastrophic costs that often deplete portfolios late in life.
8. Should I work with a financial advisor or manage my own retirement plan?
If your situation is straightforward — single income, W-2 wages, standard 401(k) and IRA — a DIY approach using low-cost index funds and a target-date fund is entirely defensible. If you have complex situations such as self-employment income, stock options, rental properties, or a high net worth, a fee-only fiduciary advisor adds significant value. Look for a CFP professional who charges a flat fee or hourly rate rather than assets-under-management, and verify they operate as a fiduciary at all times through the NAPFA or XY Planning Network directories.
9. How much of my paycheck should go to retirement?
Fidelity and Vanguard both recommend saving 15% of gross income for retirement, including any employer match. If you started saving in your 20s, 15% is generally sufficient; if you started in your 30s, target 20%; in your 40s, target 25% or more. The 15% figure assumes you save consistently for 30 to 40 years and invest at a reasonable allocation. Auto-escalation features in many 401(k) plans can increase your contribution rate by 1% per year automatically, which is one of the most effective behavioral tools available.
10. What is sequence-of-returns risk and why does it matter?
Sequence-of-returns risk is the danger that market downturns early in retirement permanently damage your portfolio, even if average returns over 30 years would have been fine. A 30% decline in year one of retirement, combined with withdrawals to live on, can deplete a portfolio decades earlier than the same decline in year 20. Mitigation includes holding 1 to 2 years of cash, maintaining a 60/40 or more conservative allocation at retirement, and reducing withdrawals during downturns. This is why the glide path in Step 4 becomes more conservative as you approach retirement.
11. How do I handle retirement planning if I am self-employed?
Self-employed workers have several powerful retirement account options, including the SEP IRA (limit $69,000 in 2024), Solo 401(k) (limit $69,000 with both employee and employer contributions), and SIMPLE IRA (limit $16,000). The Solo 401(k) is often the best choice for one-person businesses because it allows the largest contributions at lower income levels. Self-employed workers should also consider a defined benefit plan if they have very high income and want to shelter more than $69,000 annually. Setting up these accounts is straightforward through most brokerages.
12. What is the backdoor Roth IRA and should I use it?
The backdoor Roth IRA is a two-step strategy for high-income earners who exceed the Roth IRA income limits (in 2024, $161,000 for singles and $240,000 for married filing jointly). You contribute to a nondeductible traditional IRA, then convert it to a Roth IRA with minimal tax impact if you have no other traditional IRA balances. The strategy is legal and well-established but requires careful execution to avoid the pro-rata tax trap. If you have existing traditional IRA balances, consult a tax professional before attempting a backdoor Roth, as the math can become unfavorable.
13. Should I take a loan from my 401(k) in an emergency?
401(k) loans are generally a last resort because of the opportunity cost and the repayment risk. You typically can borrow up to 50% of your vested balance or $50,000, whichever is less, and you pay interest back to your own account. However, if you leave your job — voluntarily or not — the loan typically must be repaid within 60 days or it is treated as a taxable distribution with a 10% penalty if you are under 59½. Exhaust emergency savings, HSA funds, and Roth IRA contribution withdrawals before touching your 401(k).
14. How do I plan for retirement if I have a pension?
Pensions reduce the amount you need to save in investable assets because they provide guaranteed income. Calculate the annual pension benefit at your expected retirement age, subtract it from your required retirement income, and apply the 25x rule only to the remaining gap. If your pension offers a lump-sum option, the decision between lump sum and annuity depends on interest rates, your longevity expectations, and your desire for survivor benefits. Many pensions are underfunded, so verify your plan's funded status through the Pension Benefit Guaranty Corporation (PBGC) website.
Building Your Plan This Week
Retirement planning is a long game, but progress comes from discrete actions taken on a schedule. This week, complete three things: log into your 401(k) and confirm you are capturing the full employer match, calculate your retirement number using the 25x rule, and check your beneficiary designations on all accounts. Next month, build or rebalance your asset allocation and open any missing accounts. By the end of the year, complete the remaining steps and schedule your first annual review. Small actions taken consistently over decades produce extraordinary outcomes — the households that retire comfortably are not the ones with the highest incomes, but the ones that followed a plan and stuck with it through market cycles, life changes, and the inevitable distractions along the way.