The American Savings Council (ASEC), a Washington, DC-based savings advocacy organization, has identified five distinct retirement savings personalities: planners, savers, strugglers, deniers, and impulsives. People can determine their retirement personality profile online by visiting research has also found a large disconnect between savings attitudes and behavior. The proportion of workers in its 2002 Retirement Confidence Survey who were very or somewhat confident of having enough money to live comfortably in retirement increased to 70%, while the percentage of workers who have tried to calculate how much money they need to save for retirement slipped to 32% of those surveyed.

Many people appear to be saving without a clearly defined financial plan. A helpful resource to get started is ASEC's Ballpark Estimate worksheet. It contains only six steps but provides an estimate within 10% of most longer forms. This worksheet can also be accessed through the ASEC Web site noted above.

Small amounts of savings really add up. If you save just $20 per week ($1,040 per year) in an investment averaging an 8% rate of return, you would accumulate a nest egg of $16, 271 after 10 years. Saving early in life enables savers to take maximum advantage of compound interest. If someone saves $2,000 per year from age 20 to age 66, they would have $975,000 accumulated after 46 years, assuming an 8% average return. Savers who wait until age 30 and save $2,000 per year for 36 years would have $440,000 and those who wait until ages 40 and 50 and save $2,000 per year for 26 and 16 years, respectively, would have $188,000 and $73,000.

"Normal retirement age" for receipt of full Social Security benefits is gradually rising. Workers born in 1960 and later will need to reach age 67 in order to receive an unreduced benefit. Research by ASEC indicates that many people are not aware of this change, however. Those who expect full benefits at an earlier age could be in for a rude awakening.

Four steps are recommended to start a serious savings effort:

    
• Commit to saving regularly (e.g., via payroll deduction or automatic deposits)
    
• Pay down consumer debt
    
• Set aside an emergency fund
    
• Do a retirement savings calculation

Calculating what you need to save provides a feeling of greater control and is much better than not knowing.

Another recommendation is to coordinate a retirement savings analysis with the annual Social Security benefit statement that is sent to workers about three months before their birthday. A number of factors determine the amount that retirees need, including lifestyle, longevity, and health care costs. Challenges to retirement savers include taxes, inflation, catastrophic illness, and unplanned long-term care.

A quote from Yogi Berra that indicates the importance of planning: "If you don't know where you're going, you will end up somewhere else." Calculate what you need to save for retirement and get started via payroll deduction in tax-deferred savings plans and individually in IRAs and other investment accounts. Five online resources for savers are www.asec.org, www.ebri.org, www.choosetosave.org, www.americasaves.org, and www.rce.rutgers.edu/money2000.