Experts advise to take retirement for test-drive first

— -- As Baby Boomers are moving toward retirement, they're often called the silver tsunami. The nation's largest generation grew up in the turbulent time of civil rights, rock music and counter culture; now, they're unwilling to settle for the retirement that their parents had.

But there is a dilemma. Most of the Boomers turning 66 have not decided what their retirement future should be like. And they face many financial risks.

"The Boomers have always been a generation of seekers," says Holly Deni, a Boomer who is director of the elder life division of Locker Financial Services in Little Falls, N.J. "Some of us are going to redefine retirement. We are going to find new alternatives. That's going to be our legacy."

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There are a number of things that older workers should do before they retire.

Many financial planners are even urging Boomers to rehearse retirement while they're still working.

Last year, T. Rowe Price launched a free online tool called Practice Retirement. "Many people spend so much time working that they don't think about retirement," says Christine Fahlund, senior financial planner at T. Rowe Price. When they do retire, they suddenly don't know how to define themselves.

"We thought they should practice retirement" while they are still working, Fahlund says. "Practice means you can make mistakes. Practice means you are trying it out."

Consumers can use T. Rowe's online tool to see how long they need to keep working so they have a sound financial future. It also recommends making a gradual transition into retirement so they have a smart plan.

Planning is vital

Experts agree workers should find time to consider these things before they retire:

Know your expenses. "You'd be amazed how many people don't know," says Carol Bogosian, actuary and retirement expert. "But you need to look at your expenses, understand what they are." Then you can make a list for retirement.

A growing number of older Americans are also weighed down by debt when they retire.

"People who still owe a lot need to work off their debt before they retire," Bogosian says. Not everyone looks at it that way, she says. But if they don't deal with it now, they'll deplete their nest eggs much more quickly.

Know your assets. Boomers can't make good plans if they don't know how much they have set aside for retirement, as well as the value of any pension benefits and Social Security they can count on.

If they realize that they have not saved enough as they approach retirement, they still have time to try to work longer or lower their expectations.

Nearly half, or 44.3%, of the oldest Baby Boomers are at risk of not having sufficient retirement resources to pay for "basic" retirement expenditures, as well as uninsured health care costs, according to the Employee Benefit Research Institute.

In many cases, workers retire as soon as they can start receiving Social Security benefits. "They believe that they will have adequate financial resources," says Jack VanDerhei, EBRI research director. But EBRI studies show that many of them spend down their income too quickly.