Get Rich Slowly “If You Can”

If you want to live beyond 90 and be an adorable Oldest of the Old yourself, you have to plan ahead. The New York Times this weekend suggested one way to do that in a Most Emailed article called “A Path to Retirement” about “If You Can,” a free investment manual for the youngs. Also everyone, but primarily the youngs: we need it most.

That’s why “If You Can,” a concise, no-nonsense instruction manual on saving and investing for retirement, is so welcome. It’s by William J. Bernstein, an investment adviser and author on financial subjects, who is making it available free as an e-book, no strings attached, on his website. (It’s also available on Amazon.com for 99 cents, though Mr. Bernstein is giving it away free there, too, on certain days, including May 4 and 5, as posted on his site.) This pamphlet could be extremely helpful, especially for the group that Mr. Bernstein is specifically targeting: younger people who aren’t yet in the work force or have just started their careers.

Bernstein’s manual is as readable as his facts are sobering. (None of us have pensions! We’re screwed!) The most important thing you can do is to save 15% of your income starting at age 25, he says. It will get you in the habit of saving, which is good because, get ready, there’s lots more saving to do.

Saving 15 percent for a purpose that is decades away requires commitment, especially when it’s not all you’ll need to save: For example, it doesn’t include money for a rainy-day fund, a home’s down payment, a car, a child’s education, a vacation, a wedding, a bar mitzvah, a sweet 16 or anything else. All of that comes on top of the retirement savings. Yet in Mr. Bernstein’s view, that 15 percent is a bare minimum. “You’ve got to accumulate enough money on your own to replace your income one day,” he says. “You’re much better off if you start doing that early.”

Easier said than done, like all commitments that require long-term thinking when we are wired much more strongly for the short-term. Bernstein compares investing to dieting and admits he finds it easier to save for retirement than to forego the extra slice of pizza. That said, he comes ready with advice for ways to think frugally and with the future in mind. Know thyself, he says. Understand how to work with your own personality to figure out how to defer gratification in functional ways.

Read the manual and let us know what you think. Do you already save at least 15% of your income? Or is it pointless because global warming — and/or the Rapture — will get us before we reach 90?

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