Does your vision of "retiring in style" include champagne and caviar parties, a winter home in the Mediterranean and yacht trips around the world?

Or do you prefer to see yourself downsizing to a smaller home, spending more time with your grandchildren and being more active in community organizations?

Perhaps a cabin in the north woods where you can fish, cross-country ski and relax is more your taste.

No matter how you want to live during your retirement, you need to do some planning to make sure you can get there--whether it's financial planning or planning for how to stay active.

Curt Anderson, the managing director of investments at US Bancorp Piper Jaffray in Austin says the first thing he has people do when they come to him for help in planning for retirement is "to determine what kind of lifestyle they want to have."

"It's an individual issue for everyone. Some people are accustomed to living on a six-figure salary. Others are happy with less," he says.

"From there, we work backwards," he explains. "We look at the sources of income they're relying on to meet that lifestyle, such as Social Security or rental property. If those fall short, they'll have to make up the difference with investments."

That's when they have to sit down with an investment professional to determine what risk tolerance the client might have when investing. "We want them to have the maximum return on their investments within that risk tolerance," Anderson says.

A risk tolerance, he explains, is determined by which stocks the individual feels most comfortable investing in. He says some people are most comfortable investing in common stocks or things that are government guaranteed, such as certificates of deposit. Others are more willing to invest in riskier ventures because they are hoping for a greater return.

"If they're still coming up short, they have three decisions to make. One, they can save more money or they can take more risks or they can reevaluate what lifestyle they want to have in retirement," he says.

The type of lifestyle Austinites want in retirement "varies quite widely," he says. "We have individuals who are accustomed to $30,000 to $40,000 incomes and others want to live the same lifestyle they had when they made six-figure incomes," says Anderson.

"To try and say, 'this is average, this is normal,' I don't know if I can do that. It becomes rather subjective," he adds.

"It used to be people said you could get by on 80 percent of the money you earned while working in retirement. The assumption there was that you didn't have any debt when you're getting ready for retirement because your house would be paid for, the kids would be out of college, so you wouldn't need as much to live on," he says. "That's not my rule of thumb, that's just one that I've heard."

Anderson says he helps clients figure out how much money they want to have in retirement by asking what their hobbies are because they're going to have more time to do those things than they did when they were working, if they're planning on buying a second home or if they will have any other major expenses when they retire.

"All of those are factors when you're considering what you'll need in retirement," he says. "It's not a matter of me telling them how much they'll need. The clients have to decide how much they want."

However, it is safe to say most people in Austin aren't planning on retiring when they're 35 years old. "Some people do face limitations when deciding when to retire. You have to be 59 1/2 years old in order to take money from your IRAs without an IRS penalty. Social Security is often delayed until age 62--that's generally when people start taking it. Some have to wait so long before they can get health benefits from their job," Anderson says. "The fact that you can't access those things until you're a certain age are often limitations."

For many seniors, being comfortable in retirement isn't necessarily a matter of being fiscally well-off, but more a matter of having enough hobbies to stay active.

"It's always good to have money in the bank, because you need it, but it's more important to stay active," Les Traff, 61, of Austin says.

When he retired, Traff says he wanted to focus on spending more time with his family and to devoting more time to his hobbies. "I wanted to play piano, do leather work, art, photography, fishing," he says.

However, he's found that he spends much of his time at the Mower County Senior Center in Austin, teaching computer classes, playing pool and doing minor maintenance work. He says he spends four to seven hours at the senior center every day, so "art and photography are sort of on the back burner," he laughs.

Dick Buechner, 72, of Austin also says staying active is the most important part of retirement.

He stresses that it's important to begin hobbies before you retire, though.

"A lot of people keep working into their 70s because they haven't cultivated their hobbies yet," he says. "They say 'when I retire, I will take up art, ballroom dancing, and golf, but it'll never happen. You have to start those before you retire."

"You cannot sit at home in retirement. It just does not work," he says. "The name of the game is that as you age, you need to stay active."

To make sure he had the funding to stay active, Buechner says he did do some financial planning beforehand. He built the Austin Dairy Queen, and after he sold it 22 years ago, he says he "bought some funds with the proceeds of selling the Dairy Queen and they went up appreciatively."

He also says his financial situation is also helped because "as you get older, you don't have any payments. You don't have any house payments or car payments, so your living expenses are minimal."

By the time you retire, he says, "it's no big deal if you car is six, eight, nine years old. You don't feel the need to have a $20,000 car. If you need a new car, you don't mind buying one that's three years old."

Call Amanda L. Rohde at 434-2214 or e-mail her at :mailto:amanda.rohde@austindailyherald.com