You don't want to miss these 5 key retirement preparation steps.

Due to compound growth, the earlier you begin saving for retirement, the better prepared you'll feel. But what is the best format to place these savings into? And how can you avoid excessive tax penalties? Tax planning is a tactical method of positioning your investments, income stream, and savings to avoid, defer, or reduce your tax liability.

When financially planning for retirement, there are basically two phases. Relying on only one of these sources of income during this financial transition, however, can risk your retirement expenses outweighing your available funds.