Series offers tips to help achieve a secure retirement in turbulent times

Today’s challenging economic environment has forced many Americans to review their retirement planning goals with a more critical eye. To help navigate through these turbulent times, Robert Fishbein, vice president and corporate counsel with Prudential Financial, offers a biweekly series of tips on planning for retirement.

Tip No. 1: Look beyond the ‘number’
We all know what the "number" is: That magic dollar figure that, when reached, means you’re set in retirement. Knowing your number—and reaching it—is good, but it’s only part of the equation. Mastering the accumulation phase without factoring in the distribution phase could render all your hard work saving toward your number moot.

Tip No. 2: Factor in inflation
A dollar today won’t be a dollar tomorrow, it may be more like 50 cents. Assuming an annual inflation rate of 3 percent, $25,000 of savings today will have to grow to more than $50,000 over the next 25 years to purchase the equivalent amount of goods. Of course, if inflation turns out to be higher than 3 percent, you’ll suffer a further reduction in real purchasing power.

Tip No. 3: Give longevity a prominent place
In 1935, when Social Security was enacted, life expectancy at birth was 62 years. Fast-forward 70 years and the average life expectancy in 2005 reached 78. That's 16 more years—most of which will likely be spent in retirement—so longevity must play a key role in a retirement plan. In fact, planning for longevity might just be the plan.

Tip No. 4: Employ Social Security strategies
Social Security is the single biggest retirement asset for millions of Americans. Given the demise of the traditional pension plan, plus the fact that Social Security income is adjusted annually for inflation, the decision regarding when to start taking Social Security is more critical than ever.

Tip No. 5: Understanding the impact of working in retirement
Millions of Americans who looked forward to a leisurely retirement may be forced to work now that the turbulent financial markets have wiped out nearly $2 trillion of retirement savings. What's worse is potential changes in Social Security and higher marginal tax rates may make their situations even bleaker.