Here's what a Nobel Prize winner says you should consider if you're planning to retire

Harry Markowitz is the 1990 Nobel Memorial Prize winner in Economic Sciences, and a recipient of the 1989 John von Neumann Theory Prize.

Markowitz, who is known as the "father of Modern Portfolio Theory" for his work in portfolio construction, is a member Personal Capital's Board of Academic Advisors, which works to devise innovative solutions to help millions of Americans reach their retirement goals and better manage their money.

In an interview with Personal Capital, Markowitz was asked, "What do you think are the most important financial considerations for retirees?"

He replied:

Well, you have to remember that you don't know how long you're going to live. Simulation analysis of possible scenarios is one place where operations research can be of help. You need to know what the trade-offs would be if you live longer or shorter than you expect.

If you spend your retirement savings too fast, you'll be in trouble. But if, on the other hand, you spend very little and leave a big estate when you die, maybe you could have afforded to spend a little more. The problem is that such simulation analysis is not a do-it-yourself thing.

As a rule of thumb I recommend taking a look at a mortality table, and then give yourself a few more years than that to be safe. You have to redo this calculation every couple of years or so.

The Social Security Administration has a mortality table on its website, as do the Centers for Disease Control and Prevention.

Markowitz, who is 88 and told Personal Capital he loves his work, said deciding to work later in life or choosing to retire early is an individual decision. "Suppose you worked in an office job your entire life, but you always really wanted to open a restaurant," he said.

"When you retire, you have a chance to open that restaurant. That's what I would do, because if you don't move you rust. If you're really lucky, you'll find ways to get paid to do the things you find fun anyway."

Read the full interview on Personal Capital »