30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances

Part IX. Invest during Retirement

"I will say that not one of my clients' retirements looked the way they thought it was going to look. They lived longer than they thought, they lived shorter than they thought, they were healthier than they thought, they were less healthy than they thought they would be."

Financial planner Ross Levin made that point to me in a 2009 interview, and I think he neatly summed up the challenges of planning for retirement.

Financial planning for life events such as college or a home purchase is straightforward: It's not all that difficult to determine when you'll need the money, how much you'll need, and how long you'll need it.

But planning for retirement is different, because all three of those variables are up in the air. It may not be that difficult to determine when you want to start retirement, but when you should start retirement is another matter; no one wants to be in the position of retiring early but running out of money later in life. And longevity and health—two enormous unknowables—affect how much money you'll need during your retirement years and how long you'll need it.

The fact that retirees are so different, too, makes it tough to give one-size-fits-all advice.

Despite the jokes about shuffleboard and early-bird specials, retirees are not a monolith. The needs of a 60-year-old retiree who has a $3 million portfolio and has just sold his business are very different from the person who's retiring at 81 with health problems and $125,000 in retirement ...