The financial situation is really unstable. This is particularly destabilizing for retirees and those soon to retire. They followed all the rules about diversifying their investments, they checked the fundamentals and did the best to compare online trading results and at last they took the plunge and invested carefully. But now they are left in a difficult situation.

It will take some time till the markets will come back when this crisis is over. Older investors do not have the benefit of a long horizon and many are depending on their savings and investments for current "life support." Their financial life expectancy, representing how long their money will last, just got a lot shorter. But those who still have some money in the pocket can turn the paper money into circulated silver coins - they have real silver inside.

What would you do first if you have gotten to acceptance? You shouldn't begin by seeking advice from financial journals and developing a new financial strategy.

To give yourself the confidence and momentum to address your future you should create a psychological base about yourself by examining how and when you have thrived. Start by recovering few situations when you were performing at your best, you were using all your talents and strength and were so involved that you lost the sense of time. Such kind of "memory exercises" will give you important insights regarding what psychologists call your "motivational needs." These memories will help you to understand what you are really interested in.

So this would be the base to figure out what you want to do in retirement and how you will re-make your previous experiences, and it’s not necessarily have to be a work-related field. It will be especially good if some of them can be done in a way, which will result in additional income as any additional income will make the amount of money you need to withdraw from your retirement accounts lower. Researches shows that working only 30% in the first five years after retirement will result in a portfolio which is 40% larger at the end of that period.

You should prioritise those things, which you consider to be the most important for you and to create a so-called life plan for yourself that will include those things, which will make you satisfied and fulfilled. You should decide your place of living, what and with whom you will be doing.

Then it's necessary to consider the financial implications of your new life. If you have made your plan; you need to estimate what it will cost. In order to do this you can use past records to determine your anticipated spending patterns (bank accounts, credit card statements, ATM cash withdrawals, etc.). First, make a monthly budget, then convert it to a year, and add in any anticipated major extraordinary expenses (vacations, property/income taxes, a new car, a new roof, etc.). Don't forget health care costs and a reserve account for unexpected contingencies.

After making your plan think about the source of your income in order to support your monthly retirement lifestyle. Traditional sources are social security, pensions, non-retirement investments, 4% annual withdrawals from your retirement accounts, and any work-related income from part-time work, hobbies, etc. If, as expected, your income projections do not meet your needs, go back to your Plan and your memory exercises. Than determine once more to understand what is really important for you and change your strategy until that time the income and expenses will be balanced.

Read more about 401 retirement plan topic here.