How to retire the right way

Wealth alone is no guarantee of a secure retirement. It's time to start thinking about what you'll need.

Even if you are doing well, plentiful assets and a good income are probably not enough to get rid of your worries about retirement - at least not according to new studies of high net worth investors.

Thousands of affluent boomers and Gen-Xers studied by Wharton and State Street Global Advisors expressed fears about outlasting their money. You may be worried about preserving your standard of living in the face of market downturns, inflation and health care costs during a retirement that may last 30 years. In fact, 57 percent of those surveyed cited rising health care costs as their number one concern.

If you're in the younger half of those surveyed, a lack of traditional pensions, Social Security and Medicare safety nets is probably also on your mind.

Experts agree that wealth alone is no guarantee of retirement security. Saving too little "runs up and down the income scale and wealth scale," says Olivia S. Mitchell, an insurance and risk-management professor at Wharton.

Comfortable living inevitably translates to spending. Though the wealthy save, Mitchell explained in the Wharton study, "people with high earnings also spend a lot" to keep the lifestyle they enjoy going.

Reasons for concern

Your retirement isn't likely to be the same as it would have been 50 years ago. The old adage was that you needed 80 percent of your current income when you retire - but nearly half of the 1,800 millionaires surveyed by the 2007 Phoenix Wealth Survey said they will need more than 100 percent. You may even be thinking of working indefinitely, at least part-time, in order to stay engaged and support a comfortable lifestyle.

Also, your life expectancy has increased, even from just a generation ago. Determining your retirement goals is a complex process - one that means taking the time to figure out what it is you really want now and down the road.

The plan

Worried as you may be, you may not have begun planning. About 59 percent of high net worth investors have no formal written plan for their retirement goals - but a retirement analysis can help. Your financial advisor can run this analysis to assess your financial situation, your potential annual retirement income, your savings and investments and your tax situation.

Then, it's time to analyze your retirement goals. Once you know what you want, your financial advisor can determine ways to help you get there, whether that involves altering your investment strategy, changing the amounts you contribute or something else entirely. The retirement analysis will provide you with a full report, including savings recommendations and sources for retirement income.

Talk to your Financial Advisor about how a retirement analysis might benefit you.

For more information, e-mail william.a.creekbaum@smithbarney.com or call 689-8700.

Smith Barney does not provide tax and/or legal advice. Please consult your tax and/or legal advisors for such advice.

• William Creekbaum, MBA, CFP, a Washoe Valley resident, is senior investment management consultant of SmithBarney, a financial services firm serving Northern Nevada at 6005 Plumas Street, Suite 200 Reno, NV 89509.