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Planning for retirement takes foresight and thought

Just like any other major financial event in life, retirement comes upon us too fast.The difficult part about planning for retirement is that you don't know how long you are going to live and what your health and housing needs will be in the future. Some people can choose when they retire, while others may be forced into retirement at a time that is not their choosing.

Often retirement planning comes down to figuring out how you will manage on the income and assets you have. Even those who have saved and prepared for a long time did not anticipate their investments and homes losing so much value over the last few years.

In working with people who have run into financial difficulties in retirement, I have often seen a few common themes.

If married, one is going to outlive the other by a few or many years. So many have not planned for the reduction of income they will experience when their spouse dies, especially if Social Security is their main source of income. Household expenses will most likely not decrease by much, but the income will decrease by at least the smaller Social Security amount. If the deceased spouse was still working even part-time, that income will also be gone. If pension income didn't include survivor benefits at some level, that can also be a big hit for the surviving spouse.

If you are relying on extra part-time work to supplement your retirement income, remember that you likely can't continue doing that work forever. Some live a lifestyle that requires an ongoing earned income, and that can be unrealistic. If you do continue working, you want to because of a satisfaction from working, not because you have to in order to cover expenses. You may be one of the lucky ones who can work well into old age, but most can't. I see many retired people who desperately want to stop working but can't financially manage without that extra income.

Fixed incomes do not support debt payments. The most stable retirement picture is one with absolutely no debt. If your basic living expenses of food, utilities, insurance and other basic needs are covered by your basic fixed income from Social Security, pension or conservative withdrawal from low-risk investments, you can more easily survive financial challenges. Other retirement savings can cover the other extras. It can be very difficult for income to cover a mortgage, car or credit card payments.

We may want to spend our last dime on the day we die, but without a crystal ball, we need to make the best choices we can with what we have and be realistic about what the future may bring.

Marybeth Vigeland is a financial counselor at the Village Family Service Center in Fargo, N.D. She contributes to the blog Real Money at