Thanks to the many breakthroughs in medicine, we are living longer and are healthier than ever before, and some of us are even working longer, too. So with expected longer lifespans and more ability to enjoy life after we retire, how do we plan accordingly so we can maintain the lifestyle we've grown accustomed to?

The reality is that you will have more expenses, not less, once you retire, so you need to plan accordingly. The key to a financially successful retirement lies in saving. The earlier you start, the better off you'll be. You also need to know the answers to these questions:

• Have you set your retirement goal?
• When would you like to retire?
• What kind of lifestyle do you want after you retire?
• How long do you expect to live after you retire?
• What monthly income will you need during retirement to maintain your current lifestyle? What will provide that income (Social Security, investment earnings, employer retirement package, etc.)?
• Regarding medical expenses and long-term care: Do you have medical conditions now that could require lengthy hospital stays later on? How will you cover long-term care needs if they arise? How will you pay for prescriptions?
• Will you still be paying college tuition?
• Will you have a wedding to pay for?
• Will your mortgage be paid off or not?
• Have you contributed to your employer's 401(k) plan? Have you requested a Personal Earnings and Benefit Estimate Statement (PEBES) from the Social Security Administration?

Some of these questions may be difficult to think about and answer, like how long do you expect to live after you retire - but there are actually ways to calculate your lifespan, so you don't run out of money.

You should also check your credit report annually. Remember, you are entitled to one free copy a year through AnnualCreditReport.com.

Remember, each individual's retirement needs, goals and risk tolerance are different - so what works for your friends may not be the right approach for you. If you haven't done so, seek out expert advice from a financial planner such as our Investment Consultants.

With the variety of retirement options available, it can be a challenge to figure out what one (or more) is right for you. All retirement accounts offer tax benefits; however, they are not all alike. Here's an overview to help you.

401(k), 403(b) and 457 plans are employer-sponsored retirement plans. Contributions are deducted from your paycheck pre-tax. Many employers provide matching funds based on how much you contribute to the plan.

There are two types of IRAs to consider. One is a tax-deferred (traditional IRA), while the other is tax-free (Roth IRA).

Traditional IRA

• Contributions are tax deductible
• Withdraws can begin at age 59 1/2 and are mandatory by age 70 1/2
• Taxes are paid on earnings when withdrawn from the IRA
• Funds can be used to purchase a variety of investments (stocks, bonds, certificates of deposits, etc.)
• Traditional IRAs are available to everyone, and there are no income restrictions
• All funds withdrawn (including principal contributions) before 59 1/2 are subject to a 10% penalty (some exceptions apply)

Roth IRA

• Contributions are not tax deductible
• There isn't a mandatory distribution age like the Traditional IRA
• All earnings and principal are 100% tax free if rules and regulations are followed
• Funds can be used to purchase a variety of investments (stocks, bonds, certificates of deposits, etc.)
• Roth IRAs are available only to single filers making up to $95,000 or married couples making a combined maximum of $150,000 annually
• Principal contributions can be withdrawn at any time without penalty (subject to some minimal conditions)

The biggest difference between Traditional and Roth IRAs is the way the U.S. government treats the taxes. Meet with a financial planner or IRA specialist to determine which IRA product best suits your needs.

For additional details:

IRA Specialist: (800) 283-2328, ext. 6022