There are three main kinds of risks you need to prepare for when creating a retirement plan.

1. Inflation Risk
While you're still working and receiving a paycheck, regular pay increases can usually offset the impact of inflation. But when you retire, the rising costs of basic necessities such as housing and healthcare may create a situation in which you have to compromise your standard of living. A good retirement plan should help prevent that by taking inflation risk into account.
Possible Solution: Keep a portion of your savings in growth-oriented investments.

2. Market Risk
Riding the market's ups and downs can be problematic in retirement. When retirement is far off and you're accumulating assets, you may stand a better chance of recovering from downturns in the market because of the longer time horizon for saving and investing. Once you retire and begin withdrawing rather than saving money, short-term market losses may cause your account balance to decrease at an accelerated rate.
Possible Solution: Continue to diversify your portfolio and invest in a variety of stocks, bonds, and cash equivalents.

Diversification cannot eliminate the risk of investment losses, and past performance is not a guarantee of future results.

Returns do not represent returns on any MetLife product.

3. Longevity Risk
Many people don't realize that they may live longer than they plan for. When creating a retirement strategy, you should keep in mind that you may spend as many years in retirement as you did working and that, these days, savings may need to last 30 to 40 years. It's important to know how much your savings will generate and how long you expect that income to last.
Possible Solution: If you choose to manage this on your own, it's generally wise to be conservative. An alternative may be to purchase an income annuity, which can help to reduce longevity risk and provide income that is guaranteed to last a lifetime.  The tradeoff is loss of control and amount of income purchased for lump sum.