Remember that old question, "What are you going to do when you grow up?" Well, for aging baby boomers it has morphed into, "What are you going to do when you retire?" As 77 million boomers begin to march across the 50-year-old line, they are facing two choices that will define the rest of their lives. Some want to retire early and have fun; others want to work well into their golden years. Both groups are motivated by the same happy circumstance--people are living longer and staying healthier. But the financial planning appropriate for each retirement goal is very different.

Take the working retirees. A BUSINESS WEEK poll in the Annual Guide to Retirement shows that 75% of all baby boomers expect to continue working after they retire. Some want to work or do consulting in their former occupation, others in a different field. About 10% want to start their own business. For them, retirement means an income stream, so the classic portfolio switch from stocks to bonds is out. Retiring later allows for greater portfolio risk over a longer period of time. Luckily, there are plenty of Web sites, software programs, and advisers to help adjust the mix.

These same digital guides can plan for years of fun, too. Two factors are allowing people to quit the working life early--inheritance and the stock market. Some $1 trillion in inheritance money stands to rain down on lucky boomers. Thanks to parents who cashed out of their houses in the inflationary '70s, invested in the stock boom of the '80s and '90s, and left most of it behind, millions of boomers are getting the chance to golf, fish, or play tennis full-time in their 50s. And there are others whose modest retirement investments ballooned in the same bull market. These folks need a different asset mix for the next 20 or 30 years.

So for those who can begin to handle the reality of growing old, it's time to do some homework. Here's a way to do it.

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