Retirement planning is key to having the income you need after you leave the workforce. We have been working with a lot of baby boomers lately to form the right solution depending on their investment objectives and each individual’s specific goals.

Review this list of the Top 10 Ways to Prepare for Retirement

We think this is a good list to start you on your way. A Certified Financial Planner™ at First Pacific Associates will be happy to help you work out the details for the 10 points covered here:

1. Start saving, keep saving, and stick to your goals
2. Know your retirement needs
3. Contribute to your employer’s retirement savings plan
4. Learn about your employer’s pension plan
5. Consider basic investment principles
6. Don’t touch your retirement savings
7. Ask your employer to start a plan
8. Put money into an Individual Retirement Account
9. Find out about your Social Security benefits
10. Ask Questions

Online calculators can be helpful, though they don’t provide all the answers. We work with Charles Schwab and they are a great resource for basic information, so we took a look at their calculator. With so many baby boomers closing in on retirement age, we looked at the Schwab Retirement Calculator for a person of 56 years of age and returned results for low risk, moderate risk, and high risk investors.

• For Low Risk, the calculator called this style, “Conservative”, and recommended an allocation of 20.0% Stocks, 50.0% Fixed Income, 30.0% Cash Investments. It reported on “Average Return” (1970 – 2012) at 8.0%
• For Moderate Risk, the calculator called this style, “Moderate”, and recommended an allocation of 60.0% Stocks, 35.0% Fixed Income, 5.0% Cash Investments, reporting an Average Return (1970 – 2012) 9.6%
• For High Risk, the calculator called this style, “Aggressive”, and recommended an allocation of 95.0% Stocks, 5.0% Cash Investments, reporting an Average Return (1970 – 2012) 10.0%

Remember that past performance is not an indication of how a particular investment will perform in the future. However, these returns give you a general idea of how well the stock and bond markets have performed in the last 40 years. At First Pacific, we do not base your projected investment returns on risk tolerance alone. We take a holistic view of your overall finances and find the rate of return you need to reach your goals. For some, this may mean an aggressive portfolio heading into retirement to compensate for lofty or ambitious financial goals, while others may be very frugal spenders and never need returns even as high as the 8% “Conservative” hypothetical sampling above.

We can help you formulate your specific goals and provide a detailed plan to meet those goals. Contact one of our CFP^® advisors for an initial consultation. And as always, there is no cost for this initial meeting.