The truth is most of us are no where near financially ready for retirement. Although now most of us in our forties and fifties have come to accept the notion that social security will soon run out, we still seem to be stuck in the mud when it comes to sound retirement planning. Since most of us spend about 20 years of our life in retirement, we should take this very seriously as we plan for our retirement. As you read on you will see some useful steps that you can include in your retirement planning.

Are you dreaming of what retirement will be like? Does the dream have a happy sweet ending or is it a nightmare that you are happy to wake up from? You must put the dreaming aside and ask yourself relevant questions. With pencil and paper in hand take an inventory of your life.

· Will your home be paid off or will you need to continue to make mortgage payments?

· Do you plan to travel the world?

· Will you have someone depending on you, for example, grandchildren?

· In combination with social security, pensions, and other savings will you have at least 70% of your current income?

· Do you currently have an existing illness that may get worse over time and need special care?

These are just some questions that you should ask yourself when planning your retirement, but more importantly you must be honest with yourself.

If you still have at least seven years until retirement, you should contribute to a tax-sheltered savings plan. Most companies offer a 401k. Make sure to contribute the max, as most companies may match up to the first 7% or even more. With time, compounded interest, and tax deferrals your money will grow very fast.

You also may want to consider an IRA; an IRA is an individual retirement account. You will have the choice of a Traditional IRA and a Roth IRA. Basically an IRA is a personal savings account that offers tax advantages. There are no requirements to open up an IRA except that you must receive taxable earned compensation.

More then anything else the single most prevalent obstacle toward sound retirement planning is simply we spend our retirement money before we reach retirement. Believe it or not this is very common and happens all too often. We need to become discipline and committed toward our cause. The good news is regardless of age it is never too late to start planning toward our retirement.