(MONEY Magazine) – After you complete the worksheet on page 25 to estimate the percentage of today's income you will need when you leave work, use this worksheet to set an annual retirement savings goal. The worksheet is adapted from the Seattle accounting firm Moss Adams' retirement education program, "How to Retire Rich." The worksheet assumes that you will live 10 years beyond today's 17- year life expectancy for a 65-year-old. It also assumes that your retirement kitty will grow 8% a year, the historical average for a conservative mix of stocks and bonds, and that inflation will run at 5% a year. While that's higher than the current 3% rate, it's in line with the average for the past 30 years. Recalculate your savings goals every year or two to take into account shifts in your retirement plans, the performance of your investments, and changes in Social Security and your company pension.

1. Annual income needed at retirement (Insert the average amount of current income required in early and late retirement, as calculated in the worksheet on page 25. Or, if you skipped that worksheet, use 80% of your current income.) 2. Estimated Social Security and pension benefits (Call the Social Security Administration at 800-772-1213 for a projection of your annual benefit. Ask your company's employee-benefits office to estimate the annual pension you will receive in today's dollars. Enter the total of both.) 3. Annual retirement income needed from savings and investments (line 1 minus line 2) 4. What you must save by retirement (line 3 times factor A below) 5. What you've already saved:

A. IRAs, SEPs and Keoghs B. Vested amounts in employer plans such as 401(k)s,403(b)s and profit- sharing accounts C. All other investments, including savings accounts, CDs, mutual funds, stocks and bonds

Total of A, B & C

6. Projected value of your current savings at retirement (total amount on line 5 times factor B below) 7. Total retirement capital you need to accumulate (line 4 minus line 6) 8. Annual savings needed to reach your goal (line 7 times factor C below) 9. What you must save each year until retirement (line 8 minus the amounts you expect your employer to contribute annually to your company savings plans)

Age at retirement 55 56 57 58 59 60 61 62 63 64 65 66 67 Factor A: 23.3 22.9 22.6 22.2 21.8 21.4 21.0 20.5 20.1 19.6 19.2 18.7 18.2 Years to retirement 1 3 6 9 12 15 20 25 30 Factor B: 1.03 1.09 1.18 1.29 1.40 1.53 1.76 2.02 2.33 Factor C: 1.000 0.324 0.155 0.099 0.071 0.054 0.038 0.028 0.022