To plan a journey, you have to decide what the destination is going to be! The same is true with financial planning. Think through what you want to be doing in later life, and how you want to be living. Having a goal in mind can help motivate you, and make it easier to determine the practical steps needed to get there. If you don’t know what you want to be doing, you can’t know how much money you need. So, think big, but think realistic too. The best dreams are ones that can come true, after all.
Consider what your expenses will be, and how they might be different to your current expenses. For example, any offspring are likely to be adults by the time you retire, and won’t need (as much!) financial support. Equally, in an ideal world you will have paid off your mortgage too, so this monthly cost will no longer be applicable. However, you may need to account for things like care costs as you get older. Essentially, a good financial plan will align your goals with your real-world provisions and expenses, so the first step is identifying each of these categories.