Don't Trust Us With Social Security

42% of workers aged 40 to 49 take a cash distribution. In other words, workers in their prime retirement-savings years take money out of their 401(k) and spend it.

73% of workers with balances under $10,000 take a cash distribution. In other words, workers with very little put aside for retirement, either because they've just started to contribute to a 401(k) or because they don't make much money, are saying, "To heck with a $10,000 nest egg and a lifetime of saving," and just spend their balance.

Now, granted, the data I've seen from the Hewitt study don't distinguish between the worker who takes everything out of his or her 401(k) and spends every last dollar and the worker who spends just 10% before reinvesting it. But the picture still isn't very comforting.

Failure to Help Ourselves

When it comes to figuring out how a rapidly aging society can avoid a retirement crisis, I keep hearing the words of Walt Kelly's Pogo: "We have met the enemy, and he is us."

I'm surprised that the numbers in the Hewitt study are so depressingly high. But I'm not surprised at the trend. I know I'm generalizing radically, but my own email indicates that when it comes to investing for retirement or anything else, we're not especially patient, and we don't use the investor's most reliable tool -- the power of compounding over time -- especially well.

I regularly get emails that run like this: "I'm 25 and I've saved $10,000. Can you give me the names of three $5 stocks that'll double in the next year or two?"

In the eight-plus years that I've been writing Jubak's Journal, I've never once received an email anything like this: "I'm 35 and I have a portfolio of $50,000, but it's mostly in risky, highly volatile stocks. Can you give me the names of three stocks that I can use to reduce the risk in my portfolio, even if it means I'll get a lower average annual return?"