Retirement planning has evolved significantly over the years, especially as traditional pension plans are being replaced by 401(k) plans and individual retirement accounts (IRAs). Retirement planning today is a more individualized and proactive process, requiring individuals to take charge of their financial future.

In the past, many workers relied on company-sponsored pension plans, which guaranteed a specific income in retirement. However, with the rise of defined contribution plans like 401(k)s, the responsibility of saving for retirement has shifted to individuals. These plans allow employees to contribute a percentage of their income, often with employer matching, and invest in a range of financial products.

Retirement planning now involves estimating future living expenses, understanding inflation, and creating an investment strategy that balances risk and return over time. Many people also seek the advice of financial planners to determine how much to save, how to invest, and how to draw down their retirement savings once they retire.