Without adequate financing, many of your retirement dreams may remain just that—dreams. So before you finalize retirement plans, you may want to consider professional assistance. To get a complete picture of your financial resources, include Social Security, pensions, Individual Retirement Accounts (IRAs), 401(k) plans, savings and any other investments in your equation. Then talk to a professional about how best to allocate those resources and get an idea of how much income your investments will generate.

Also, if you’re expecting a lump-sum payment from your retirement savings plan, be prepared to make the choice as to how you will handle it. The reality is that you’ll have to share some of this money with Uncle Sam. However, how well you understand your options for managing this money, and how well you’ve planned, will determine how much you actually end up with. Basically, you can:

Take the money up front and pay tax on the entire lump sum (special tax treatment may be available); or
Maximize your earnings potential by arranging to roll over your entire lump sum directly into an IRA or annuity, in which case you will pay taxes later as you receive distributions.

Evaluate the costs of the retirement lifestyle you envision. Think about added expenses, for example, health insurance if your retirement plan doesn’t provide it. And be sure to figure in taxes, unfortunately, they don’t stop just because you stopped working. Think of this exercise as a reality check. You’re sure to feel more comfortable with the retirement decisions you make after doing all the math.