In Your 40s

FEED YOUR ESCAPE FUND. When a fixed payment stops, such as day care or a car loan, put that money into retirement savings. You won't miss it.

MONITOR YOUR INVESTMENTS. Your 401(k) account should be performing at least as well as the asset allocaton or target-date funds in your plan. If not, make a switch.

REFINE YOUR RETIREMENT PLAN. Plan to withdraw no more than 4% to 6% of your funds each year. Be realistic. You will need more money than you think, probably close to 100% of your final pay.

VACATE YOUR VACATION HOME. Find the place where you want to retire, purchase your dream home, and rent it out. If you visit regularly to check up on your property, the travel may be partially tax-deductible.

GET TO WORK. Set up a home office and start working out of it so you are used to the routine. If you have plans to do volunteering in retirement, start serving on a board of directors or work with nonprofits. You may want to talk to a career counselor to help define your goals.

By Lauren Young

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