The financial world is changing, and some popular pieces of wisdom don't hold up quite as well as they used to. The rules that worked in previous decades might not lead to the same outcomes thanks to forces such as inflation, changing interest rates, and stock market volatility.

One such idea is that you need to replace 75% of your income in retirement. Below, I'll explain why and then consider some alternative approaches to this traditional retirement planning strategy.

Following this rule opens the door to some key retirement risks, and it's not the best way to think about goal setting during retirement planning. There are three main reasons that you can improve upon the 75% income replacement goal.

Continue reading

Source Fool.com