Retirement is supposed to be the end of your working days; at least that is the goal. Unfortunately for a lot of people that turns out to not be the case. Many people find that they don't have enough money to retire on and they need to continue to work after they have retired in order to make ends meet. This is something that you want to make sure that you avoid.
While most people don't want to work after they retire the sad fact is that there are quite a few people who find that they have to. Given the number of people who have virtually no savings it is quite probable that the number of people who work after retirement will increase in the future. In order to avoid this issue it is important to make sure that you realistically assess your financial status. This comes as an unpleasant surprise to quite a few people when they discover that they have nowhere near enough to retire on.
The first thing that you are going to have to do is to determine how much you need to retire with. This is something that most people grossly underestimate. Mainly they don't really assume that they will live as long as they actually do. You also have to make sure that you factor in all of the costs of retirement; things like health care are probably going to become much more expensive as you get older. You also need to make sure that you think about how inflation will affect your savings. You could be retired for decades and the inflation can really add up.
Once you know how much you need to retire with you need to determine how much you have. That means that you need to add up all of your savings. One thing to keep in mind is that you are going to want to put your money in low risk investments as you approach retirement so you need to factor in the slower growth rate. You are also going to want to add any retirement benefits that you have to the amount of savings that you have. You should be able to get a good idea of what you will be getting from things like your pension. Don't forget to include the taxes, this includes the deferred taxes on any retirement savings account that you have.
One other thing that you need to think about to determine if you can afford to retire is the amount of debt you have. This gets a lot of people into trouble, they think that they have enough savings to retire but fail to consider that they still have to pay off their debts. This is becoming a growing problem with the number of people who have serious issues with credit card debt. Remember they will still expect to be paid after you retire.