How to Build a Retirement Income Plan if You're 10 Years Away

Are you 50-something, give or take some years, and thinking about retiring in about a decade? If so -- and even if you're 20 years from retiring -- it's time to start thinking about your retirement income plan.

Here are some tips on how to go about it, to set up as financially secure a retirement as possible.

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First, develop a plan

Unless you are financially independent, you will need a comprehensive retirement plan. You'll need to figure out how much income you'll need in retirement -- and how you'll get it. So track your expenses carefully over a few months or a year, and then use that information to estimate your future income needs. Keep inflation and healthcare costs in mind as you plan, too.

Consider setting up multiple income streams. That way, if one income stream, such as Social Security, ends up disappointing you, the others may still deliver. Here's one way these streams could look:

Other possible income streams include a pension, rental property income, royalties, bond interest, and so on. A little digging online can turn up more, such as getting a reverse mortgage, selling a life insurance policy, renting out space in your home, taking on a side gig for a while, and so on.

Have a Social Security plan

Be strategic about when to claim Social Security. You can start collecting Social Security as early as age 62, but most folks will get the most out of it by delaying until age 70, if they can. Married people should coordinate their claiming strategies together.

If you're behind in your saving for retirement

If your retirement nest egg is much smaller than you think you need or want, there are some strategies to consider. First, start saving and investing more. A powerful move is to delay retirement by a few more years. That will let your nest egg grow more, and it will also have to support you for fewer years. It can also help you delay claiming Social Security.

Another possibility is relocating for retirement -- to a less costly region or perhaps just to a smaller, less costly home. Also, consider getting healthier and staying healthy, as that might reduce your healthcare costs.

Try out your retirement plan

Once you've determined how much income you want to live on in retirement, try doing so! If your household income right now is, say, $100,000 and you think you can retire well on $80,000, try living on that now (for up to a year) and see how it goes.

Think through some what-if scenarios, too: What will you do if the stock market crashes and stays down for a few years in your retirement? How will you handle needing a new roof or a new transmission for your car? What if you or your spouse gets very ill? It can help to think through such scenarios and to have some kind of rough plan.

If your retirement is a decade or more away, know that you do have lots of time in which to improve your financial health and secure a more comfortable future.

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