For those still reeling from the devastation of the 2008 economic meltdown, take heart! You can still salvage your retirement and save your portfolio.

The folks at AARP Financial recently published eight steps to help you get on a path to financial security. Most of their advice is spot-on; I wholeheartedly agree that you should make sure you're sufficiently insured, consider the effects of inflation when planning your investments, and save aggressively. But AARP Financial -- and other sources I've seen -- also list a few bits of "advice" with which I can't quite agree.

Average isn't good enough
For starters, when (sensibly) recommending that you study your financial big picture, AARP advises using a longevity calculator to get an idea of how long you'll live and, therefore, how long you'll need to support yourself. That's a start, but it's not enough.

I checked AARP's own longevity calculator, for example, and learned that I can expect to live until age 89. That's good to hear, but remember that it's just an estimate. I might live to 100, or get run over by a bus next week. It's important that we not plan our finances based on this kind of life expectancy, lest we prove the calculator wrong … and run out of money in the process.

In the past, we Fools have suggested longevity insurance to address this risk. As opposed to life insurance, which pays out at your death, longevity insurance protects you against living longer than you expected. In exchange for a single premium payment up front, you'll get deferred monthly payments beginning well into your retirement, often age 80 or later. You can buy a longevity policy while still relatively young, and set guaranteed monthly payments to begin at a particular time down the road.

Dream on
AARP recommended focusing on an "affordable retirement" as opposed to a "dream retirement." I understand why it's good to be realistic, but I think that it's also useful to dream big. If you're aiming for a dream retirement, you might actually attain it.

And even if you fall short, you can probably settle for an affordable one -- that's not so bad, is it? You might have to work longer in order to reach your financial goals. But if you only aim for affordable, and you still fall short, well ... yikes.

IRA power
Another key strategy to get your financial life on track is to make the most of your 401(k) at work and your IRAs. A key advantage of 401(k)s is that you can plow a lot of money into them each year -- as much as $16,500 in 2009 and 2010, and up to $22,000 if you're 50 or older. With IRAs, the annual maximum contribution is $5,000 for 2009 ($6,000 if you're 50 or older), but you have more flexibility with that money, since it can be invested in individual stocks of your choice. IRAs are unsung heroes in the retirement planning world -- more powerful than you might realize.

One strategy for IRA investing focuses on dividend-paying stocks. That's a solid idea, since with Roth IRAs, both the capital appreciation and dividend payments from your investments will eventually be available to you tax-free.

Here are some growing dividend-payers you might want to look at more closely:


CAPS Stars
(out of 5)

Recent Yield

5-Year Avg. Annual Dividend Growth

Coca-Cola (NYSE:KO)




Stryker (NYSE:SYK)




Sasol (NYSE:SSL)




Hasbro (NYSE:HAS)




Terra Nitrogen (NYSE:TNH)




Interactive Data (NYSE:IDC)




General Mills (NYSE:GIS)




Source: Motley Fool CAPS, Yahoo! Finance.

If you feel like your financial life has gotten derailed, don't despair. There are plenty of things you can do today to make your tomorrow much, much better.

If you're going to get your finances back on track, you have to avoid unnecessary mistakes. John Rosevear talks about what might be the biggest mistake you'll ever make.

Longtime Fool contributor Selena Maranjian owns shares of Coca-Cola. Hasbro and Interactive Data are Motley Fool Stock Advisor recommendations. Coca-Cola and Stryker are Motley Fool Inside Value picks. Coca-Cola and Sasol are Motley Fool Income Investor recommendations. Sasol is a Motley Fool Global Gains selection. Motley Fool Options has recommended writing puts on Interactive Data. The Fool owns shares of Stryker and Hasbro. Try any of our investing newsletters free for 30 days. The Motley Fool is Fools writing for Fools.