You won't be able to retire.

What if you heard these words five years before you planned to retire?

The dreams you had of forever sleeping in, immersing yourself in a new hobby, and spending countless hours spoiling your grandkids -- all gone, because you hadn't saved enough during your working years.

You probably have a sinking feeling in your stomach just thinking about this terrifying scenario.

Yet this is the reality many folks will face way too late in their careers. According to an August study (link opens a PDF) published by the Center for Retirement Research at Boston College, "Even if households work to age 65 and annuitize all their financial assets, including the receipts from reverse mortgages on their homes, nearly 45% will be 'at risk' of being unable to maintain their standard of living in retirement."

And the statistics become worse the younger you are -- Generation X-ers are at a 49% risk. That works out to one in every two 30- to 40-year-olds who will have to work until they come to their eternal rest.

Dreams of carefree days don't have to be history
Like me, I'm sure you want to avoid being counted among these statistics. Fortunately, if you're still working, you still have some time to salvage a secure retirement. It will take a little bit of effort, but it's better to lose a few weeknights of fun than the last 20 or so years of your life. Trust me.

Let's begin at the beginning
First and foremost, you'll need to start by determining when you'd like to retire, and develop an approximation of how much money you'll need in retirement. Analyze your current expenses to establish which will remain, which will depart, and project others that may coincide with older age (like medical bills, for instance.) This information, in turn, will help you to estimate how much you need to save annually.

Chances are, your retirement income will come from more than just your personal savings (though the younger you are, the chances you have for supplemental income are diminishing). Be sure to factor Social Security estimates, pension plans, etc. into the scenario.

Save, save, save
Investing is by far the most profitable -- and effective -- way to save for a wealthy, secure retirement. Start by maxing out your 401(k) plan (after all, free money should not be turned down), and then develop an asset-allocation plan for yourself. This should be based on your saving timeframe, your ability to stomach risk, and your personality in general.

Robert Brokamp, retirement mastermind and advisor to our Rule Your Retirement newsletter service, offers these model portfolio allocations:

Asset Class




Large-cap stocks




Small-cap stocks




Foreign stocks












Pick funds in your 401(k) plan and IRA that align with the asset class allocations above -- so that when one is lagging the market, the other classes' outperformance will balance out any possible losses.

A low-maintenance (and relatively safe) way to invest among the asset classes and receive steady returns is to invest in various index funds, like Vanguard 500 Index (VFINX). It has a low expense ratio -- just 0.18% annually -- and has returned 15% annually over the past five years.

It tracks the S&P 500 index, investing your money (weighted by market cap) in large-cap stocks like Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), General Electric (NYSE:GE), ExxonMobil (NYSE:XOM), Altria (NYSE:MO), ConocoPhillips (NYSE:COP) and Wal-Mart (NYSE:WMT) -- stocks that also offer strong growth and/or a healthy dividend.

I promised earlier that it would only take you a few weeknights to complete -- and it should. But you'll want to continue to determine whether your retirement goals have changed, and to rebalance your portfolio back to your ideal allocation.

Still unsure when you'll be able to retire? Are you even saving enough? These questions, and many others, will be answered in the "How to Plan the Perfect Portfolio" online seminar beginning Oct. 8. The Rule Your Retirement team will guide subscribers through an eight-lesson course and answer any and all questions you may have regarding your own retirement. Reserve a seat for yourself with a no-obligation 30-day free trial -- and sign up now!

Fool analyst Adam J. Wiederman is on the path to ruling his retirement, thanks to Robert Brokamp - and owns no securities mentioned above. Wal-Mart is an Inside Value recommendation. The Fool has a Foolish disclosure policy.