Perhaps the greatest challenge for someone approaching retirement is making reliable assumptions about the future. Because a person’s quality of life in retirement will be determined by the quality of his or her long-term financial plan, it is imperative to make prudent and conservative investment choices now. Even a slight miscalculation could cause a plan to fall short of expectations.

To build the best foundation for retirement, consider these seven questions and answers.

1. How much income growth are you expecting?

Construction executives sometimes overestimate their future income potential or believe, at the very least, that their income will steadily increase throughout their careers. Unfortunately, the construction industry is frequently unpredictable, and many underlying circumstances can cause income to remain fixed, or even worse, decrease.

It’s best to base a retirement plan on current earnings or a very conservative estimated growth rate. Don’t forget to maximize the potential for asset accumulation by taking full advantage of any available retirement plans such as a company 401(k) or a supplemental executive retirement plan (SERP).

2. How much will you be able to save once you have an empty nest?

Many executives plan to set aside more money for their own retirement after their children have been raised and educated, but these plans often never come to fruition because of increased spending patterns as life progresses.

Others in the industry have their best intentions thwarted when they encounter unforeseen responsibilities, such as paying for a child’s advanced degree, caring for sick or elderly parents, or supporting grown children or grandchildren.

Don’t wait until children leave the nest to start retirement plan contributions. Keep lifestyle choices in check and begin a disciplined savings plan early. Even if it means setting aside what seems like a paltry amount, start the habit of saving now.

Also, make regular and systematic increases to investments and take advantage of tax-protected savings plans that do not carry heavy penalties when the money is accessed during retirement.

3. What long-term returns can you expect from your investments?

Attractive returns over the last several years may have substantially distorted many investors’ expectations. Investors cannot prudently assume the next five or 10 years will deliver the same combination of excellent stock market performance and low inflation.

In addition, construction executives who delay their preparation for retirement will force themselves into the unenviable positon of needing to invest more aggressively than otherwise would have been necessary.

Buying relatively safe, high- quality equities at the initiation of an investment plan, and then holding on to them for years, will provide much more security (and likely more gain) in the long run than taking wild risks on “get rich quick” stocks later in life.

4. Are you investing to get to, or through, retirement?

Investing for growth should not end on the last day of work; inflation can destroy a neglected nest egg. Admittedly, it may make sense to invest more conservatively upon retirement, but it is not a necessity.

In fact, the most important determinants of the level of risk people need to take in their investment portfolio are their specific financial goals and objectives. Determine those first and then construct an investment portfolio that will provide the highest likelihood of reaching those goals with the least amount of risk along the way. Even in retirement, continue to watch investments for opportunities to maximize their potential.

5. Where will your retirement income come from?

Some retirees may overestimate the contribution that Social Security or a fixed pension from a previous employer will make toward their overall income requirements in retirement. For the most part, these income sources are fixed benefits that will not buy the same level of goods and services on an inflation-adjusted basis year after year.

It is important to take steps now to minimize reliance on fixed benefits. Instead, plan to grow investable assets to cover inflation-adjusted income needs in retirement. Construct an investment portfolio that pays off in retirement while continuing to grow in value.

6. Will your expenses decrease during retirement?

One of the most ridiculous rules of thumb many personal finance pundits follow is that the average person will need only about 70 percent to 80 percent of his or her pre-retirement income to maintain their desired standard of living in retirement. The thinking is that people will live on less after retiring because they no longer have to contend with workplace expenses, such as business clothing, daily travel and costly lunches. However, because many retirees want to enjoy what they worked so hard for and experience things they were unable to while working, they actually could spend more during their retirement years. In fact, many retired people actually spend more than 125 percent of their pre- retirement income once they fully retire—at least in the first few years of retirement.

It’s important to scrutinize financial goals very carefully when planning for retirement. Spend time with family or anyone else who will figure into retirement plans to determine what the “perfect” post-work life looks like and how much it really will cost. Make realistic projections of what’s affordable and don’t forget to consider inflation as a potentially limiting factor.

7. How long do you expect to live?

With the average life expectancy in this country dramatically increasing during the last century and all of the medical advances and breakthroughs that continue to occur, it is imperative to plan for accruing the financial resources to spend at least one-third of life in retirement.

Construct a retirement plan based on the assumption people will live 30 percent longer than the average life expectancy dictates. For example, if the life expectancy for a particular gender, racial background and personal lifestyle is 75 years, plan to live to 98 instead. This may appear overly optimistic, but it’s prudent to be prepared for the best possible scenario.