People turning 50 today are beginning to view that milestone as a time of enjoying new-found freedom, of making new choices and dreaming new dreams. They approach life after 50 with more education, greater economic resources and diverse attitudes, experiences and expectations.

But the picture isn't rosy for everyone. As baby boomers and other older workers pass through their peak earning years, few of them are actually accumulating much personal savings, which raises serious questions about their financial security when they retire, according to three new studies sponsored by the AARP Andrus Foundation.

The studies show that several groups have an especially tough time saving for retirement, including women, part-time workers, minority group members, those with limited education and workers past age 40 who are unemployed for any length of time.

Researchers at Boston University, Florida State University and the University of Louisiana at Monroe found troubling signs that many workers have set aside little or no personal savings toward retirement.

Even when assets including home equity and company-sponsored IRAs were included, the studies found that the median level of financial assets was $50,000 among a nationally representative sample of people aged 51 to 61. And there is a wide disparity among these "pre-retirees," with the wealthiest 5 percent accounting for about 72 percent of all financial wealth.

When assets like a home and IRAs were excluded, the picture became dismal. According to the studies, workers aged 45 to 60 averaged only $1,844 in personal retirement savings.

"Workers today are expected to do much of the financial planning and saving for their own retirement, and these studies show that many of them aren't saving, either because they lack the resources or the knowledge," says John Feather, director of the AARP Andrus Foundation. "With the continuing slow economy and talk of revamping Social Security, these studies can help us gain insight into the financial picture of boomers and other older workers."

But there are steps anyone can take to help improve their financial outlook for retirement, according to the AARP.

A secure retirement consists of four strong pillars: Social Security, a pension or savings account, earnings and health insurance. The "old school" of thought looked at retirement planning as a three-legged stool, represented by Social Security, savings and employer-sponsored pensions. But a massive shift away from employer-sponsored pension plans to defined contribution plans such as 401(k)s has caused two of those traditional legs to merge into one, altering the balance of risk in retirement income from the employer to the employee and creating the need to be more proactive about saving.

Another major change is escalating health care costs, which mean that adequate health insurance coverage must be treated as a component of retirement security. Without protection against commonplace expenses -- especially prescription drugs and long-term care costs -- virtually no one over age 50 in America should feel economically secure.

With those exceptions, analysts say that even in a slowed economy and uncertain world situation, basic planning for retirement and investing is the same: what was smart money management before is still smart.

To start, list your goals. A goal should be a statement of what you want your financial future to look like. Include the date you defined your goal, the dollar amount needed to reach it, the target date to reach it and the date you actually attain it. Consider all areas of your life: retirement, housing, hobbies, volunteering, traveling, employment, major purchases and physical fitness are some examples.

Next, keep a financial inventory. In a notebook or online, create a personal directory, a professional directory, a list of vital documents and their location, a personal financial statement, cash-flow statement and spending plan. Also list information about your credit cards, insurance policies and bank or brokerage accounts. When you've completed this directory, keep a copy handy in your house and give a copy to a friend or relative or in a bank safety deposit box for safekeeping.

Finally, prepare your personal financial statement so you know where you stand in relation to the goals you've set. List your assets: all savings and investments including cash (checking and savings accounts, money market funds or certificates of deposit), retirement funds, pension or profit sharing accounts, business interests, and other investments such as life insurance, stocks or bonds. Also include personal assets such as your home, other real estate, household furnishings, jewelry or other personal property.

Liabilities to list include all debts (including any for which you have co-signed), such as credit card balances, personal loans, business loans, mortgages or taxes owed. Subtract your liabilities from your assets to find your net worth. You should update this at least yearly or whenever there is a major change.

As with any savings plan, it is essential to "pay yourself first." Add to your savings or investment accounts before making unnecessary purchases or payments that may be flexible and include additions to your accounts in your monthly budget planning. The key is to get started as soon as possible and let your savings earn interest to grow more quickly.

Courtesy of ARA Content