You don't need a fortune to retire, but you do need to be realistic. The goal is to calculate your annual needs and spend down your capital during your lifetime.

Say you determine you want to retire at 66, and that you will then need $60,000 a year to live on. Assuming you and your wife will receive $20,000 annually from Social Security, that leaves $40,000 ($60,000 - $20,000) outflow per year. Over the 10-year period to age 76, that adds up to $400,000.

Over the next 15 years, your spending is likely to decrease to, say, $45,000 per year less the $20,000 from Social Security. That's a net outflow of $25,000 per year or a total of $375,000 ($25,000 x 15). The total outflow from the retirement age of 66 to age 91 is $775,000 ($400,000 + $375,000).

So, you don't need a fortune to retire -- just $775,000. You will pull out $40,000 in each of the first 10 years, between interest and capital, and $25,000 in each of the next 15 years. Inflation will be offset by the return of interest, so there will be enough left over for any subsequent years over the age of 91. --Howard Scott is a business writer and small business tax preparer in Pembroke, Mass.