Picture your desired lifestyle. A retirement spent traveling the globe or with an ocean view is obviously going to cost more than downsizing into a smaller house or condo. Those who choose a low-cost place to retire may be able to get by with significantly less money. "Someone who lives in a community in rural South Carolina is going to need a different amount of money than someone who lives in New York City," says Spraker. "It completely depends on the person's lifestyle and how early they retire." Retirees willing to work part time in retirement can also get by with less in savings, and those willing to delay retirement can shorten the number of retirement years they need to finance.
Estimate life expectancy. The wild card in retirement planning is how long you will live. Your nest egg must be divvied up to provide a stream of income that will last as long as you do. Spraker says retirement savers should plan on living into their 90s, while Stone recommends budgeting for age 100. Couples should also factor in the woman's typically longer life expectancy.