What is retirement planning?

Retirement planning is fundamentally about determining your income goals for retirement and figuring out the necessary actions to achieve them. It involves assessing your financial situation, understanding your future lifestyle needs, and estimating how much money you will require to live comfortably once you stop working. This process also includes evaluating different sources of retirement income, such as Social Security, pensions, and personal savings, along with exploring investment strategies that align with achieving these goals.

Other choices focus on specific aspects of financial management but do not encompass the comprehensive nature of retirement planning. For example, investing in real estate is just one investment strategy and does not cover the overall plan for retirement income. Creating a budget for the current year is crucial for everyday financial management but does not specifically target long-term retirement objectives. Minimizing debt is important, particularly as retirement approaches, but it is only one component of a broader retirement plan.