It's certainly not a pleasant thought to think about: traditional pensions are disappearing and Social Security is on the road to bankruptcy. Yet the biggest obstacles that can threaten your retirement funds aren't always mentioned in the headlines.

Setbacks like losing your job and life-threatening medical conditions are surprisingly common in later life.

A recent Boston College study has found that the results can be particularly devastating for those nearing retirement. The college's Center for Retirement Research studied people in their 50s and 60s and found that: Twenty percent of workers lost their jobs during the 1992 to 2002 study period. Among married couples, nearly one in three experienced job loss. - Forty-one percent of those studied were diagnosed with a major medical condition such as heart problems, diabetes or cancer. - Thirty-four percent experienced health-related limitations on their ability to work. - Eight percent were widowed, 7% experienced a severe disability and 4% divorced.

Overall, the study found 6 out of 10 people in their 50s and 60s experienced some kind of serious negative shock that threatened their financial security.

How to protect yourself:

These are scary statistics, but they convey an important truth about retirement planning: you can't assume everything will go right.

Now here's how you can apply that knowledge:

Don't put off saving for retirement.

The more money you have piled up by your 50s, the better you'll be able to survive whatever surprises life throws your way. People who put off retirement to save for other goals, or simply spend more, are missing out on critical time that can help them growth their wealth. But they're also leaving themselves vulnerable to the setbacks described above that could prevent them from accumulating needed wealth.

If your employer has a matching retirement plan, take full advantage of it. If not, start setting aside money on your own.

Get covered.

Having health and disability insurance can help protect you from the financial fallout of accident or illness. If you can't get this coverage through an employer, consider buying individual policies. If you find yourself without health insurance, read "A survival guide for the uninsured" for tips on how to protect your well-being.

Live a healthy lifestyle daily.

We can't make ourselves immune from disease, but we can better our odds for a long, healthy life by eating right, exercising, getting regular checkups and finding appropriate ways to deal with stress.

Continuously update your job skills and contacts.

Keep yourself marketable by taking on new responsibilities or learning new skills through courses or seminars. Look to start multiple sources of monthly income through prudent investing that are independent of your employer.

Don't Rely On Others To Manage Your Money.

Learning the basics of investing can increase your rate of return and prevent you from working with financial advisors who may have interests that conflict with what's best for you.

Copyright (c) 2008 Paul McBride