What's a Realistic Retirement Budget? I'm 62 With $890k in a 401(k), $115k in a Roth IRA and I'm Eligible for Social Security.

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During most of the decades you are preparing financially for retirement, you are likely focused on saving as close as you can get to the recommended amount, without worrying too much about the details. As you approach retirement, however, it's a good idea to look more closely at what might be a realistic retirement budget. At age 62, with $890,000 in a 401(k) account, $115,000 in a Roth IRA and accounting for Social Security benefits, you can likely generate enough income to cover typical retiree lifestyle expenses. Your individual needs may vary, of course, but there are likely moves you can make now and in retirement to give you the flexibility you'll need to fund a comfortable and secure retirement.

Consider speaking with a financial advisor for help building an effective retirement strategy.

A typical retirement budget starts with the income side and Social Security benefits represent an important part of that for a large majority of retirees. Social Security is lifelong, guaranteed by the U.S. government and includes annual cost-of-living adjustments to keep up with inflation. The amount of your specific benefit is controlled by your work history and age at claiming. Assuming your current income is $90,000 annually, here are estimates of your annual Social Security benefit based on your age when you start claiming benefits:

You will likely want to consider waiting to claim Social Security as long as possible so the benefits can increase. You may claim sooner for a variety of reasons, including lower lifespan expectation or physical disability that force you to stop working. But for many people, delaying will produce a larger overall payout.

You will also be able to generate income from your investment portfolio. The age at which you plan to retire is an important consideration here as well when it comes to how you'll manage your nest egg. If you plan to stop working in the next year or two, you'll likely pursue a conservative investment strategy designed to protect principal and perhaps generate income. If you expect to work until age 70, on the other hand, you may seek a more growth-oriented approach in order to help your savings grow.

A conservative strategy employing an asset allocation evenly balanced between stocks and fixed-income investments might generate a 5% annual return. A relatively aggressive growth strategy might put 70% of the portfolio in stocks and 30% in bonds which could in theory return 10% each year. This growth plan could more than double the current combined total of $1,005,000 in your 401(k) and Roth IRA to $2,154,307 in eight years.