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Your "golden years" are closer than you think! You know you need to save for retirement. Perhaps you've been stashing away some funds for that "someday," but how do you know if you're saving enough?

There isn't any way to know for certain how much you'll need to save today in order to afford the lifestyle you see for yourself down the road, but putting some thought to it NOW and coming up with a retirement plan will help ensure that you arrive "over the hill" in comfort.

Here are a few suggested steps to take to figure out how much is enough when it comes to saving for retirement:

  1. Set an annual income target. How much would you like to have in retirement? Take a stab at this, though it's difficult to say for certain. A benchmark is 70-80% of your pre-retirement income, but if you plan to do a lot of traveling or golfing at the finest resorts, shoot a bit higher. You can add in any expected Social Security benefits along with any pension payments you'll receive, and subtract an estimate of taxes due on your retirement income.

  2. Set a target based on what you'll need in order to generate the targeted income amount from Step 1. What this means is that you need to figure out how much in total you'll need to have saved and assume a certain amount is withdrawn each year. Let's say you save $1.5 million in your nest egg. If you take out 4 percent each year, you'll have an income of $60,000.

  3. Check to see if you're on target to hit your mark. Are you saving enough currently to build the nest egg of your dreams? Since this will take more than a piece of scratch paper, check out our financial calculators for assistance.

  4. Revisit your plan often. Once your retirement savings plan is in place, check in from time to time to make certain you're still on target. Make any needed adjustments.

If you take the time now to calculate how much you need to save to enjoy your retirement years later, you'll be not only doing the right thing for yourself, but you'll be ahead of the majority of those surveyed recently by the American Savings Education Council. Knowledge (and planning!) is powerful. Take the time today to enjoy your future tomorrow.