Retire rich? Now?

I can hear the screaming already:

I lost half my nest egg last year! The stock market is going to be dead for years. I'll never make it back in time to retire. Bonds are a joke. I'll be lucky to have a job for much longer. I'm going to be working until I'm 100.

I hear these kinds of things all the time. There aren't very many optimists left these days, and in truth there hasn't been much to be optimistic about. Layoffs continue at a scary pace all over the world -- check out these cuts in just the past month:

Company

Recent Layoffs Announced

Cisco (NASDAQ:CSCO)

3,000

NetApp (NASDAQ:NTAP)

480

Electronic Arts (NASDAQ:ERTS)      

1,100

THQ (NASDAQ:THQI)           

600

Philips (NYSE:PHG)

6,000

Walt Disney (NYSE:DIS)

200

Nokia (NYSE:NOK)

625

Meanwhile, the FDIC seems to be seizing new banks every Friday, grim economic forecasts continue, Citigroup and Bank of America and General Motors and ... well, you know. If you're reading this, you know the basic story. It's not a happy one.

And yet, despite the damage to our portfolios, despite the loss of home equity and the scary credit situation and the sudden feeling that our employment might be tenuous -- or for many, the sudden feeling of getting up in the morning and having no job to go to -- I say that we can still get to a secure, comfortable retirement from here.

You might think I'm nuts
For a long time now, most discussions of building wealth have started with the assumption that 10% annual returns from the stock market are a given over the long term. While it's true that the market has put up that average over the very long term (like, since the mid-1920s), there are plenty of shorter periods in the market's history where it didn't get close to those numbers. If you're, say, 15 years out from retirement, 10% annual returns from here aren't a slam-dunk.

You can't just throw it all in an index fund and ride to wealth anymore. Not unless you're young and have plenty of time for things to shake out.

It's more complicated now. I do wish there was one simple piece of advice I could give, one sure-thing investment I could recommend that was worthy of your confidence and your money. But there isn't. There is, however, a way to build wealth, a way to get to a comfortable retirement. And it doesn't require crazy risks or arcane knowledge. You don't have to be nuts.

Quite the contrary.

Going back to non-nutty basics
More so now than ever, the road to retirement success requires old-school discipline and focus. To get the most out of what you have to work with, you need to have your financial house in order and make the most of what your circumstances, your employer, and the U.S. government give you. Specifically:

  • Use the secret key. I've said before that spending less than you earn is the secret key to wealth. Now is an excellent time to cut back optional spending, pay down any credit card debt, and create a realistic, livable budget that allows for a significant amount of savings -- 10% is good, more is even better -- from every paycheck. (Yes, your 401(k) contribution counts!) Follow those links to find out more.

  • Get your financial act together. In the February issue of the Fool's Rule Your Retirement newsletter, advisor Robert Brokamp explained how to put together a "financial control center" -- one place in your house where all of your important financial records live. The key concept is this: Gather all of your financial records -- everything from insurance records and receipts for big-ticket items to your year-end brokerage statements and tax records -- in one place and organize them. And -- this is important -- throw away what you don't need. If you're a Rule Your Retirement subscriber, take a look at the keep vs. toss checklist that accompanies the article; you'll see that you probably don't need half the paper you've got lying around. (If you're not a subscriber, grab a free trial for 30 days of full access.)

  • Use what they give you. Have you maxed out your 401(k)? The contribution limits go up when you turn 50 -- did you raise yours? Are you putting at least some of that money into stocks? Yes, the market's in the trash can, but that's when you want to be buying. You'll thank yourself when the economic sun comes back out in a few years. But as I said above, the most important thing right now is to be saving as much as you can and making the most of what you have saved. Don't forget those IRA contributions!

Last but not least, stay informed and stay on track. If you're like me and you get an instant headache when phrases like "you need long-term discipline" show up, take a look at the rest of Robert's article in the February issue of Rule Your Retirement. It's a complete headache-minimizing program for getting on track and maxing out your financial potential -- with features that will keep you on track all year. Not a member? A recession-priced (free!) trial gives you 30 days of full access. Click here to get started.

Fool contributor John Rosevear has no position in the companies mentioned. Nokia and Walt Disney are Motley Fool Inside Value selections. Electronic Arts and Walt Disney are Motley Fool Stock Advisor recommendations. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool's disclosure policy is a nut-free part of a nutritious breakfast.