02/ What resources do you already have?
Next, you can evaluate what resources you will already have when you retire without putting anything aside.
First, will you have any pensions? If so, how much will you receive each year in your retirement from your pension or pensions?
You can also improve your current resources through improved financial management such as working to improve your credit score. Small changes can make a huge difference over one or more decades.
Second, how much Social Security income will you likely receive each year? [click here to quickly use a calculator provided by the Social Security Administration (external site) to loosely estimate the amount of Social Security income that will be paid to you in retirement].
Now, subtract your annual Social Security and pension money that you learned about from this step from from the number you wrote down on a piece of paper from Step 01/ and write down the new number on a piece of paper. For example, if you originally wrote down that you will need $75,000 and then you found out you will have $30,000 annually in Social Security money, but you will have no pension money, write down $45,000 on a piece of paper ($75,000 minus $30,000). This is the amount of annual income you will need from your investments.