By Jayne McBurney, Johnston County, N.C. Cooperative Extension AgentThere has been much hype and fanfare to welcome baby boomers to retirement, yet we are learning that many of these of retirement age are not happy. According to the Pew Research Center, 76% of a group of adults (age 65 and older), polled in 2012 were dissatisfied with the direction that the country is going. Specifically, they noted that their standard of living is lower than their parents, and they are concerned that the standard of living that their children will face will be even lower.So what caused all this? Didn’t they prepare for this milestone? Won’t Social Security take care of them? They get free health insurance through Medicare, don’t they? Should we just blame this on the government, mortgage lenders and bad investing?For many who are approaching retirement age, there seems to be a misconception as to what to expect. For this reason, it is important to start talking about retirement when one begins their career, if not sooner. Retirement saving can start as early as the first job, even if it is babysitting for a neighbor or cutting the grass of the old woman down the street. When applying for full time jobs, prospective employees should ask about retirement plans and 401K opportunities.The younger one starts a good habit of saving, the more likely the standard of living will be constant into their retirement years. When I teach, I like to use the example of two women, Penny Wise and Ruby Highlife. Penny Wise is a frugal woman who learned much from her mother about spending smart and saving. Starting at age 25 with her first professional job, Penny began investing $2,000 a year into a retirement plan. She did this for ten years (see chart below). When she reached age 65, with an average rate of return of 8%, she had $545,344 in her account from just ten years of investing.Ruby Highlife wanted to live for today and not worry about tomorrow. She began working right after college, and didn’t start saving for retirement until she was older (see her chart below). At age 35, Ruby started saving $2,000 a year, and kept saving until she reached age 65. After thirty years of contributions, she still does not have as much invested as Penny.While this illustration is very basic, it reminds us of the time value of money. The longer money is invested; the more that money will grow. These women were investing less than $40 a week, imagine what would happen if one invested more. Employees should also maximize matching contributions offered by their employer to build a retirement nest egg.The website Bankrate provides a calculator to determine how much an individual will need to retire. Factors included in the calculation are current income, number of years until retirement, number of years anticipated in retirement, rate of inflation and annual yield balance. This calculator gives you an idea of what you might need to continue in retirement to live within your current means. There is also a 401(k) calculator for individuals to take a look at how contributions can grow over time. The Ballpark Estimator is another tool to help you estimate how much money you need to save to retire at various percentages of your current income. It takes into account estimated Social Security income and any current investments you already have.These calculators are great, if one plans to live on the same earnings as they have now. Yet many approaching retirement consider international vacations, beach vacations, and perhaps giving back to causes. These all cost money, as do medical issues that might require hospitalization and rehabilitation.In addition to saving, workers near the end of their career need to consider what their health insurance needs might be. Medicare provides for major medical insurance, but it is advisable for an additional plan to be in place for basic medical coverage. Some might receive the opportunity to purchase insurance from their previous employer through a group plan. Others might find that purchasing a supplemental plan from their insurance agent would better suit their needs. Many individuals also consider the purchase of a long-term health care policy that will provide the ability to access care in the case that they are unable to care for themselves.Finally, housing must be considered. If the 30-year mortgage has been refinanced multiple times as interest rates dropped may not be paid off completely before retirement. Having a home equity loans may extend the mortgage beyond its original 30-year plan. For retirees that continue to own a home with a mortgage, housing costs will include the mortgage, homeowners insurance, and maintenance. Retirees who plan to sell their homes must consider also the cost of selling, moving, and establishing a new place to live.The bottom line in retirement savings is to start now; it is NEVER too early to start this plan. If you have earned income, you can open a Roth IRA. Retirement accounts should never be considered emergency funds, for which one must also budget. Individuals should consult with an appropriate financial services provider (e.g., financial planner, tax consultant, lawyer, insurance agent) for professional and detailed advice about their individual situation. It is hoped that by starting early, like Penny Wise, an enjoyable retirement can be achieved.Resources:http://www.bankrate.com/calculators/retirement/retirement-calculator.aspxhttp://www.bankrate.com/calculators/retirement/401-k-retirement-calculator.aspxhttp://www.choosetosave.org/ballpark/http://pewresearch.org/databank/dailynumber/?NumberID=1150 Economic Readiness for Retirement by Jayne McBurney is licensed under a Creative Commons Attribution 3.0 Unported License.