As hard as it has been for me to watch my 401(k) balance dwindle during the last few months, it has been comforting to know that I have 25 or 30 (maybe 35!) years in the work force ahead of me. In other words, plenty of time for the market to bounce back.

And fall again.

And bounce back again.

But for people who retired in the last few years, the situation is different.

Stephen sent me an e-mail to say he retired at the age of 66, and he is now 69. His former employer had a great retirement plan, he wrote, putting an amount equal to 25 percent of his annual compensation into retirement funds for him.

"When I retired in 2006, I had more than $1 million, which I put into my IRA at TIAA-CREF," Stephen wrote. "It grew until I had $1.2 million, even with the amounts I took out to live on with my Social Security. Now it has fallen to below $700,000. There is about $480,000 … in the annuity interest-producing account at little risk with the rest in the stocks and equity accounts. Do you think I should just sit tight and hope the stocks come back?"

Stephen wrote that he now uses about $48,000 per year of those funds.

"Should I be withdrawing more or less? The mandatory age 70½ withdrawals are coming up next year. Together with my Social Security, this puts me about $90,000 per year income. I am trying to draw out more so that I get the taxes paid and get it into (certificates of deposit), but it is difficult to assess whether I am taking too much or too little," he wrote.

I'm guessing many recent retirees can relate to Stephen's dilemma. For some help with answers, I contacted Sharla Jessop at Salt Lake City-based Smedley Financial Services.

Jessop says she has worked with many people who, like Stephen, want to be financially prepared for retirement but are struggling to develop a plan.

"Sometimes people think a plan is having a retirement date on the horizon and money in the bank," Jessop says, but that is not all a person needs to consider.

She says Stephen and people like him need to start by assessing what's left of their resources, analyzing needs versus wants and maybe making a lifestyle adjustment. Plans for the future should take into account how long a person's money may last and how much return he or she will get on his or her investments, Jessop says, plus the effects of taxes and inflation.

She tells her clients to think in terms of "pockets" of money. She determines how much a client needs for the first five years of retirement and puts that money in a very safe and secure pocket. "We're not as worried about return on money, but return of money."