The persistent cry to "save Social Security" is fueled by the realization that there are serious threats to the system. The Social Security benefits of today's retirees are largely paid by the contributions of people who are currently employed. As the Baby Boom generation enters retirement age and as retirees live longer, the number of people collecting Social Security is growing faster than the number of workers paying into the system. No simple fix can remedy this problem in the foreseeable future; any saving of the system will probably involve higher retirement ages, lower benefits, and possibly increased Social Security taxes.

The shakiness of Social Security is only one challenge facing tomorrow's retirees. Longer life spans mean more time for inflation to eat away at the buying power of your income. As people grow older, they may eventually need such services as ongoing healthcare and assisted living arrangements—expensive services that can quickly wipe out a life's savings. All this is beyond the cost of travel, retirement homes, and leisure activities that are part of the dream retirement for many people.

If we want our retirement to be anything like our dreams of leisure and security, it is clear we have to plan carefully to make sure we will have the resources we need.