What is the primary purpose of retirement planning?

The primary purpose of retirement planning is to ensure financial stability in the absence of regular income. As individuals transition from their working years into retirement, they typically no longer receive a steady paycheck. Therefore, planning for retirement focuses on creating a financial strategy that allows individuals to maintain their desired lifestyle without the regular inflow of income from employment.

This involves assessing the expected expenses in retirement, determining available assets, and creating a withdrawal strategy that supports those expenses effectively. A solid retirement plan takes into account factors such as savings, pensions, social security benefits, and investments to accumulate wealth over time and provide a sustainable income stream once one ceases to work. Thus, the essence of retirement planning is rooted in preparing for a financially secure future, devoid of the work-related income that supports individuals throughout their careers.