A random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing

Inadequate 
Preparation 
for
Retirement
According to a survey of consumer finances conducted by
the Federal Reserve Board of Governors, the typical
American family has little money in the bank and
considerable credit card debt. Less than half of all Americans

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have any kind of retirement account, and those who do have
an account have about $35,000 in it. While older Americans
(between the ages of fifty-five and sixty-four) have, on
average, more than twice that amount, it would not be
sufficient to replace more than 15 percent of their household
income in retirement. It’s not a pretty picture. For many
Americans, the golden years are likely to be extremely grim.
Boomers approaching retirement who wish to avoid a life of
meager rations in a cold-water flat have only two realistic
choices. They can begin saving in a serious way.
Alternatively, they can beat the odds and die early. As
Henny Youngman used to say, “I’ve got all the money I’ll
ever need if I die by four o’clock.”
For readers who find themselves in the situation I have
described, I have no easy answers. You have no alternative
but to work during your retirement years and to control
expenses and save as much as possible. But there is a bright
side even for you. There are many part-time jobs that can be
done from home thanks to the Internet. And there are
psychological and health benefits to working in retirement.
Those who do some work have a better feeling of self-worth
and connectedness, and they are also healthier. Indeed, I

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would recommend that everyone should delay retirement as
long as possible and put off taking Social Security until full
retirement age so as to maximize annual benefits. Only for
those in very poor health with a short life expectancy would I
recommend starting to take benefits at the earliest age at
which you can start to collect.