As more individuals change jobs more frequently, work for smaller firms or for themselves, and retirement firms shift more and more toward self-directed defined-contribution plans, individuals must ensure for their own retirement.

Two other factors that are causing individuals, especially young workers, to take a more instrumental role in their retirement are the longer life expectancies and the uncertainty of the social security program. More years spent in retirement and less reliance on company and government-sponsored pensions, will necessitate an increased focus on individual retirement planning.

Unfortunately, many individuals still believe in retirement "fate"-that one day they will decide to retire, and there will be the necessary funds or income to keep them in their current lifestyle. Perhaps they believe that a hefty pension plan, a generous family, or social security benefits will give them the resources they'll need. Other individuals, especially older workers, may simply not want to envision how their financial future will look or are unwilling to do the work now to ensure a retirement of financial security and a comfortable lifestyle. As a result, many of these individuals feel they don't need to "plan" for their retirement. However, it's precisely because of poor planning that causes many individuals to work more during their retirement years or for more years before they can retire.

For most individuals, the best choice, both financially and emotionally, is to effectively plan for retirement. Retirement planning involves the financial vehicles and strategies individuals and families use during their working years to ensure they will meet their goal of financial security upon retirement.

Proper retirement planning will help a family or individual:

• It will identify the likely investment sources and amounts that can be expected to finance the individual's retirement years.
• Identify various options for working during retirement
• Determine a realistic standard of living
• Estimate the amount of money necessary to finance the desired retirement standard of living
• Help determine when an individual will be able to retire
• Determine whether part-time employment during retirement should be considered

Proper retirement planning is designed first and foremost for the individual client. It's unlikely that "cookie-cutter" plans and rules-of-thumb will work for most individuals in the area of retirement planning. Individuals and families have far too many different personal goals, circumstances, risk tolerances, etc., to provide an simple, one-size-fits-all retirement plan. Effective retirement planning uses inputs from the client and planner to design strategies unique to that individual or family. By working together an effective strategy can be developed that will best suit the needs of the client.

David Alan Pace, CFP, CFA Pace Financial Services

This document is for information purposes only. No part of this report may be reproduced in any manner without permission of Pace Financial Services. The views and opinions expressed in this report are not intended to serve as specific financial planning advice or recommendations, and individuals should discuss their specific financial goals and available options with a professional advisor.