Most financial planners and actuaries calculate that you need a good twenty-thirty years of saved up income and a house already paid up. It was a good assumption for our parents' generation. Nowadays, with medical breakthroughs, we can all look forward to a longer life span than our parents. And, unlike them, we'll not have much savings, nor a house paid up.
So, the first thing we need to do is live below our means while we are employed and able to put away money for rainy days, for children's college. So many things to finance! If you are a modern two-spouse income household, try to live on just one of those incomes, and sock away the rest.
We couldn't save enough for our children's college because we were still paying back our own student loans.
We even tapped our retirements a few times for tuition, to buy our first house, to reconstruct after a major earthquake.
How much money should we have had before retiring? Interestingly, less than we thought.
We didn't need the things we needed when our family was young.
Our house? We slashed our house payments in half by moving to a more affordable place.
This is what you need:
Mental and physical stimulation.
Could you live without a car?
Could you live without a land line?
Could you work part time?
Could you make your own gifts?
Could you exchange your services for those you need? For instance, there are time-banks all over the country, an exchange of hours, my cooking for you, you repairing my plumbing.
Could you grow some of your food? Or do your own picking?
These questions are meant to stimulate yous saving buttons. If you could live without a car, you have dropped a good amount of money into your savings. If you already have a computer, you have a lot of networking and entertainment capabilities, including inexpensive ways to read papers and find out about the world. Track your expenses and make a game of slashing them.
You don't have to retire at any particular age, so, plan on working as long as you can and as long as it doesn't kill you.