You might have run into a story this week about retirement derailers, the unexpected life events that tend to put retirement savers off-track and leave them tens of thousands of dollars behind their goal.

Ameriprise Financial, the big financial planning firm, recently released a study of 1,000 employed and retired Americans between the ages of 50 and 70, each with at least $100,000 in investible assets.

The survey respondents were on average $117,000 behind their personal retirement goals, citing a number of unexpected financial impacts, retirement derailers such as stock losses, low interest rates and declining home equity.

They also brought up retirement derailers in the form of unexpected expenses, notably caring for grown children or grandchildren. Only one-third of the respondents said that they felt confident in their ability to manage a large expense in retirement, for instance a major home repair.

More than one-third (35%) said that the losses they had experienced meant that they were less likely to be able afford the basics in retirement. Nevertheless (and perhaps unrealistically), 64% felt that their road to retirement remained “smooth.“

The solution to the problem, naturally, is: “Have more money.“ But the reasons why that isn’t working out for retirees vary considerably.

In a very real sense, when middle-aged or older parents take on the responsibility of financing their children, particularly paying for education, they assume a huge personal risk. A young person can work or borrow to pay those costs. That’s admittedly hard to do under current circumstances but within the realm of the possible.

What’s impossible is retiring with little money in your retirement savings accounts. Work is less desirable as you age and possibly a swiftly foreclosed option if health fails. Borrowing is out of the question. All lending presumes a collateral in the form of either future earnings or some asset, such as home equity.

The bottom line on retirement derailers is this: Your kids have time and choices, but you do not. You love them, but you can’t sacrifice your financial life to them. If you do, the inevitable result will be dependence on them to survive later on.

But what about retirement derailers in the form of market forces? This is where the concept of “risk-adjusted return” is crucial.

Money management is not about “beating the market,“ however long and hard the financial media touts outperformance and hedge fund gurus. It’s not a sport where first place is all that matters. Finishing is what matters.

True retirement derailers

So what is risk-adjusted return? There’s a lot of fancy math in the background here, but the concept is disarmingly simple. If you target a return of 7%, how much do you increase your risk by stretching to 8% in a given year?

The answer should be “little to none.“ If you have to take a lot of extra risk to push for that extra 1%, what happens is that you quickly get hooked on the better return. It works one year, then the next, then in year three or four — disaster.

The disaster year then resets your long-term average return much lower, even more so if you panic and sell. It’s very hard to recover from that kind of outcome, as the Ameriprise survey on retirement derailers results sadly illustrate.

You can, with some deft family politicking, avoid becoming the bank of last resort for your children in tough times. It’s hard, but within your abilities.

As for the market forces out there, the best answer is to seek a return matched to your time horizon and risk tolerance. If necessary, raise your savings rate to meet your goals, rather than amplifying risk in hopes of making up the gap.

It’s the single biggest question facing working Americans of all ages: Can I retire on time, and what will happen once I finally quit working?

Financial planners can sit you down and do a real work-through of every variable in your life — housing, health, kids, your lifestyle, to help you retire on time. But it helps to do the “back of the envelope” calculation as soon as possible. You can’t meet a goal you haven’t set, and this is a big one.

One simple way to think about it is in terms of the classic “4% rule.” While the applicability of the rule is in question thanks to low bond yields, the math is still useful for figuring out how much money you need to retire on time at a targeted income level.

Simplified, you take your portfolio’s total value and multiply by 4%. That’s how much you can expect to live on, leaving aside for the moment Social Security and any pension you might have.

In number terms, that means you need $1 million to generate $40,000 in income. A $3 million portfolio creates an income stream of $120,000 a year.

How does it work? It’s deceptively easy math: 1% of 1 million $10,000. Times four is $40,000. If you assume a market return of 7% minus 3% inflation, you end up with $40,000 for every $1 million you control as a maximum withdrawal rate.

If the market does better, you reinvest. If it does worse, that reinvestment should protect you through the “down” years.

Scary numbers, I know, but it’s crucial to think about your money in terms of the eventual income it will produce if you plan to retire on time.

So crucial that the U.S. Labor Department is considering changing retirement law to require defined contribution plans, more commonly known as 401(k)s, to explain workers’ savings in terms of lifetime income after retirement.

Many state pension systems already do this. If you have a state plan, it likely clearly illustrates on each statement how far your money will go in retirement as a monthly income.

That’s a huge help if you expect to combine your 401(k) savings with Social Security income later. Similarly, if you log on to the Social Security Administration web site these days, they also will project your retirement income through the government retirement system, tailored to you.

By combining these two numbers, it should be relatively easy for people to arrive at a sense of how far off the mark they are as they near retirement.

It’s harder, of course, when you’re younger and need to estimate so many future costs. Nevertheless, back-of-the-envelope math can at least help to set a goal to retire on time.

Now for the final piece of the puzzle. How do you get to that target? Here’s where another rule of thumb can help, one known as the “Rule of 72.”

Financial planners use this often. It has limits, of course, but the basic math answers a lot of questions about how your money grows over time.

The Rule of 72 gives you the number of years required to double your money in an investment. The other number you need to know is your rate of return, the “speed” at which your investment increases in value.

How to retire on time

If you believe your investments will increase at an annualized rate of 7%, for instance, you take 72 and divide by 7. The result is 10.3. It will take a little more than a decade to double your money.

As you can see, a lower rate of return means it will take longer. Getting 3% means waiting 24 years to double. Likewise, earning 12% means your money doubles in just six years.

The really important lesson here is compounding. As you save, your money grows into more money all by itself.

If you put away $100,000 and it doubles in 10 years, that’s great. But over the next 10 years, it doubles again — $200,000 turns into $400,000 and then into $800,000 at the end of just 10 more years.

So, there’s your homework assignment. Whether the Labor Department gets this rule change approved or not, sit down soon and figure out if you’re on track and, if not, what it would take to retire on time.

A new report casts considerable doubt on how well many Americans will fare in retirement: Those born between 1966 and 1975, the so-called Gen-Xers, will be the worst off regarding their retirement plan, able to replace only half their working income. Older savers will do better, but only just.

What happened? One way to look at the problem is through a policy lens. As companies abandoned pension plans during the 1970s and onward, Americans were slowly pushed to fend for themselves in retirement. We replaced that system with the largely voluntary 401(k) and IRA-based retirement plan.

Experts often speak of retirement plans as “defined benefit” or “defined contribution.” The difference can seem subtle, but it’s quite stark. Pension plans promise an outcome (the benefit) and then work to provide it. Private, individual savings plans promise an opportunity (contributions today with tax breaks and company matches) while not guaranteeing the result.

One can easily debate the relative merits of either retirement plan path, but the point is largely moot. It’s extremely unlikely that corporations will voluntarily resume the long-term financial risk of running pension plans. They dumped pensions for a reason.

What’s left for working Americans who expect to retire is a real retirement plan puzzler. How can an individual replicate the predictability and solidity of a pension-style plan sized down to one? Is it even possible?

The retirement plan fix

The answer is yes, but it takes a fundamental reimagining of the purpose of saving and retirement. Here are the five basic retirement plan steps:

1. Pay yourself first. If you don’t save money, you won’t have money. Budget experts suggest doing a breakdown of where you spend every dime, but the simplest budget method by far is to remove a significant percentage of your pay in advance (double digits, at least) and deposit it into an account you cannot easily access. You can’t spend money you don’t have. Safely deducting savings ahead of your check is exactly what a 401(k) does quite well.

2. Take every tax break you can. The ancillary benefit of a 401(k) is that someone else — your employer working with the IRS — automates the pre-tax deduction process for you and keeps all the records intact. That’s a major load of paperwork that you as an employee almost certainly wouldn’t take on. Your taxes are lower today, and the benefit is easily portable as you change jobs, which of course you will.

3. Estimate your real retirement plan needs. This can be the tricky part. Caught between generations that depended on private pensions and government retirement plans, most people seem to believe that “someone else” will take care of the problem of paying their bills once they cease working. Yes, you probably will get something out of Social Security, but the idea that it will be enough to support your lifestyle is plainly an illusion. You have to have enough money set aside to finance, at minimum, 70% of your highest paycheck. Most young people won’t make it, Pew found.

4.  Stop hoping the market will save the day. Once savers begin to accept that they are not on track, that’s when interest in the markets and investing tends to take root. The problem is, real pension planners never hope to “make a killing” on a stock. They have a legal responsibility to assume the worst and plan conservatively. That doesn’t mean holding cash or being 100% bonds for decades (which brings its own risk). It does mean seeking a reasonable return for the risk assumed and dialing down that risk as you near retirement.

5. Think like a pension manager. Do you know if you’re on track to retire on time and with ample income to sustain your lifestyle over decades in retirement? A pension manager knows exactly how well or how poorly his or her retirement plan is working. You should have enough information to feel the same level of confidence, information the government is working to require of 401(k) plan providers.

It’s possible to save enough and retire on time with a reasonably safe income — mathematically. What’s missing is the will to take charge of one’s own financial future, a lesson the Gen-Xers will unfortunately have learned very late in the game, if the current retirement plan data holds true.

There’s a battle brewing for your retirement savings, and it’s shaping up to be a doozy. Billions of dollars each year roll out of company-run 401(k) plans and into personal IRAs, increasingly directed by retirees themselves. Do it yourself investing is the new “normal.”

Who wants a piece of that money? Well, your old 401(k) plan would like to keep it, of course.

That’s what led to a recent federal study, put out by the Government Accountability Office, warning the public that the plans often attempt to steer workers directly into IRAs they run, thus maintaining their hold on fees charged.

The problem isn’t so much that their own IRAs are bad, but that workers don’t realize that they have choices, the GAO explained: Keep it in the 401(k), put it into a new employer’s plan, roll over into an IRA run by the same firm or a competitor, or (by far the worst choice) cash out.

Rollovers are a fast-growing part of the market, estimated to hit $450 billion by 2017, up from $315 billion last year, reports The Wall Street Journal. As a result of this wave toward IRAs, the Journal writes, more people are attempting do it yourself investing, rather than hire a financial adviser.

Most money is still managed by advisers and 401(k) plans, according to Cerulli Associates, $18.2 trillion in 2011 compared to $4.2 trillion through online brokers. But the do it yourselfers are on a bit of a rampage, stung by high fees and a feeling of mistrust.

Do It Yourself Investing Quiz

Considering being your own adviser? Worried about messing things up? Here are some fundamental questions to ask before trying do it yourself investing:

1) Do you care enough to learn about investing? This is a major stumbling block for many retirees. After decades of allowing a mutual fund or 401(k) plan manage their money, they are forced in retirement to take a crash course in do it yourself investing. Some are ready and willing to take on this learning curve, and some clearly are not. Decide who you are.

2) Are you doing this alone or as a couple? It’s crucial for couples to share the burden and the responsibility of knowing how their shared savings will work as a long-term income source in retirement. If only one person in the relationship is involved, then do it yourself investing risk to the other person is quite high if a spouse dies or becomes incapacitated.

3) Are you confident in your emotional ability to manage money? Early on, investors can afford to ignore “volatility,” the tendency for investments to rise and fall in value. If you have decades to go until retirement, the day-to-day value can seem irrelevant. Generally, too, good long-term investments can be volatile in the short run. Once retired, however, volatility can lead to poor decision-making, emotional trading and panicked choices. Understand where you are emotionally before you take on do it yourself investing.

4) Do you understand what fees you should pay? The reason all the brokerages and advisers want your retirement accounts so badly is, very simply, they will collect ongoing fees for managing your money. Very high fees are sometimes sold as evidence of exclusivity or skill. Nothing could be more backward. If you don’t know what fees you pay and nobody at the firm will explicitly say the number to you, that’s big trouble.

5) Do you have complex tax and estate situations to consider? Financial advisers do have an important role to play and they can add value. For instance, properly choosing from the different types of IRAs (taxable, tax-deferred, Roth or a combination), managing income for survivors and investing for heirs. You can buy that advice à la carte from most good advisers, what is known as “fee only” service.

Being confident in your money management skills is important all through life but especially as retirement nears. So is knowing when to seek help with do it yourself investing, and knowing the appropriate price to pay for any service you choose to engage.

Americans have long known that medical care is much, much cheaper abroad. What they didn’t know until recently is that the same procedure at one hospital can cost a fraction even across town.

Treating a heart attack, for instance, costs $89,000 in one Miami hospital and more than $166,000 a few miles away, reports The Washington Post, using new federal government data. A joint replacement in Washington, D.C. ran $30,000 in one place and nearly $69,000 nearby.

There are a lot of complex reasons why healthcare prices vary so widely. A big one is industry secrecy; hospitals don’t want their competitors to undercut them, so everyone keeps quiet.

As shocking as the gaps in hospital charges are — and a 300% variance in the same zip code does make you scratch your head — it’s nothing compared to the impact of retirement fund fees.

This is especially true for retirement savers. How do funds charge you? Through a seemingly small fee that pays the managers who make the underlying investments, reported as part of the total “expense ratio.”

Active managers argue that their retirement fund fees are reasonable because they offer the potential for a higher return, by which they mean “higher than the market itself.”

A couple of problems present themselves immediately. The biggest is that very few of them actually achieve their stated goal in any given year, especially after you subtract their own fees. Maybe one in five, on a statistically significant basis.

Could you manage to pick those few winning managers, year after year? Vanguard Group looked at this question in depth, and your chances are about the same as flipping a coin.

Okay, you might say, I’ll buy an S&P 500 index fund and go to sleep for a few years. Well, careful now, the “hospital charges” trap is in your path.

Turns out, there are a lot of funds with S&P 500 in their name and which appear to own the index. Yet their retirement fund fees are nowhere near the same.

To look at two extremes, we ran a Lipper screen on funds that own the popular, broad U.S. stock index. We found the Rydex Series Trust S&P 500 Fund Class C (RYSYX) at an expense ratio of 2.26% and the Vanguard S&P 500 ETF (VOO) at an expense ratio of 0.05%.

To be fair, these are very different products. The Rydex fund is managed. At this writing, for instance, it holds nearly 25% cash, according to Morningstar. It’s no index fund, even if S&P 500 is part of the name.

There’s no pretense of talent or even activity over at Vanguard’s VOO fund. Look under the hood there and you’ll find nearly 99% stock and tiny bit of cash, essentially a snapshot of incoming dividend flows soon to be redistributed back into shares.

Comparing retirement fund fees

We ran both funds through the fund analyzer at FINRA, an industry-run regulator. Imagine $100,000 earning a market return of 7% over two decades. All things being equal, what happens?

The managed fund ends up at a balance of $246,256 while the passive fund ends at $383,118. Shockingly, total fees at the active Rydex fund come to $73,357 vs. $2,108 at the passive Vanguard fund. That’s almost 35 times more expensive!

Arguably, a retirement investor would never own this fund. Likewise, there must be  at least one active S&P 500 fund manager out there who can say he or she beats the market in a way that matters to retirement-oriented investors, consistently and cheaply.

It’s just that your chance of owning the right fund during the right year is exactly that — chance.

A few recent articles tackled the issue of increasing numbers of recent grads living at home, a.k.a., the “boomerang kid.”

The ratio of 25- to 34-year-olds cohabiting with Mom and Dad is one in three now, up from 11% in 1980, reports the Pew Charitable Trusts. (Surveys vary but generally agree that it’s up overall.)

Meanwhile, unemployment is higher for those under 30, at 11.7%, and many face paying down their part of more than $1 trillion in student loan debt. Some are having a hard time covering very high rents near the jobs they do land.

On the other hand, nearly half of boomerang kids told Pew that they pay their parents rent and even more of them help out financially in other ways, so it’s a bargain of sorts.

As a result, young Americans are finding out how young people in the rest of the world “grow up.”

For instance, many people in their 20s and 30s or even older in developing Asia and Latin America live at home well after finishing college. Extended families under a single roof are normal nearly everywhere else.

That’s not to make a value judgement either way. Being independent early can bring some advantages, though it’s  a costly lesson for those in the high-rent areas, such as Manhattan.

Likewise, a boomerang kid is not necessarily a slacker. Some set short-term financial goals only achievable by getting another year or two of living under a parent’s roof. Saving for more schooling, for instance, or a down payment on a house.

Simultaneously, the current generation of young workers and savers has some interesting characteristics on their own. An Accenture survey found that they think of themselves as “conservative” investors.

Yet conservative doesn’t mean “non-investor,” since so many of them are being automatically enrolled in 401(k) plans through work. They probably shouldn’t be quite so gun-shy about investing in stocks, for instance, since their time horizons are the longest of us all.

Considering these trends, younger savers living at home could do three things to really make a difference in their long-term outlook and the retirement prospects of their medium-term hosts, good old Mom and Pop.

Being a good boomerang kid

Here’s some financial advice for them, or for you to pass along if you’re the hosting parent:

1) Consider how your living at home will impact your parents’ ability to retire on time. They’ll never bring it up, but the cost of keeping you afloat might be punching a big hole in their plan. If you have a job or other income, find a way to make your presence “cost neutral” while you’re there.

That might be buying your own food and paying part of the utilities, or simply renting back your old room at market rates.

2) Figure out how to have something to show for the short-term advantage of a lower cost of living. Up your 401(k) contributions, build an emergency cash fund and set aside money for your eventual escape to a place of your own.

3) Do not outstay your welcome. Much like you would sign a lease with a landlord, come to an agreement with your parents about how and when you’ll exit their home.

That’s also a good time to explain how your saving and good behavior will benefit them down the line in terms of your ability to fend for yourself and be financially stable as an adult, a time when they might need to turn back to you for support in old age.

Warren Buffett, the jocular Midwestern billionaire best known for his appearances in business magazines and on CNBC, has joined Twitter.

Yes, that’s right, the online bastion of starlets and rappers and millions of ordinary teenagers is now an outlet for probably the most anti-technology curmudgeon of modern times. His first tweet? “Warren is in the house.”

If you don’t know Twitter, it’s microblogging, a service that allows you to release thoughts freely to the world so long as they are short and to the point.

Which is, when you think about it, a pretty good fit for Buffett. He’s known for his short, meaningful quotes on how markets work. He’s also a fan of passive investing, once saying that most people should buy and hold index funds and not try to recreate his success as an investor and businessman.

Here are some oldies but goodies from the master, along with a bit of decoding for the novice investor:

1. Someone’s sitting in the shade today because someone planted a tree a long time ago. Classic Buffett. He’s talking about the compounding effect of money. The math can get heavy but the simple fact is that money well-invested doubles every seven to 10 years or so. Then that money doubles again.

Think about it: $100,000 in an IRA at a reasonable rate of return turns into $200,000 in about a decade. Then that $200,000 turns into $400,000 and the $400,000 into $800,000. All without adding a cent of new money. It’s how Buffett got so rich. So, go plant a tree today by putting money into your IRA or 401(k).

2. Rule No.1: Never lose money. Rule No.2: Never forget rule No.1. Active traders love this quote, which is funny because they leak money like a broken bucket. They pay too much in commissions and take losses for no good reason. What Buffett is really talking about here is avoiding having to sell your investments because of your emotions.

Stocks rise and fall in value over the years. If you get a chance to increase a position that has gone down, do it. For the passive investor, that means rebalancing, automatically selling high to buy low in a programmatic fashion.

3. Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it. Buffett often talks about Mr. Market, a fictitious business partner of every investor. Mr. Market has a severe personality disorder. Some days he thinks business is great and would never sell his shares to you. Other days he’s catastrophically depressed and wants out at any price.

It can seem a bit cold, but your job as a serious long-term investor is to recognize those days when Mr. Market comes in ready to sell and to use that moment to buy however much you can. You needn’t time the market to achieve this; it can be done in small steps through smart rebalancing.

4. In the business world, the rearview mirror is always clearer than the windshield. The perfect illustration of this is the moment when a CEO is on a cable TV finance show and the anchor asks him or her to predict the next quarter’s results. It’s a natural question. After all, millions of viewers who own the stock would like to know.

The CEO has no idea. They are forced to give “guidance” to Wall Street in advance, but that’s a guess nearly anybody who reads the company’s books could make. Likewise, pundits who try to estimate the near-term direction of any investment are just stabbing in the dark. It’s ridiculous, and it’s about 90% of what happens in the financial media.

5. You only have to do a very few things right in your life so long as you don’t do too many things wrong. This really sums Buffett up in one sentence. You don’t have to pick the right stock today, tomorrow or ever. You really just have to save enough and invest it prudently with a reasonable expectation of return.

Once you have that down, leave things alone. The mistake you’re itching to make is the single biggest danger you face as an investor. Engage your money life, but don’t believe for a minute that you call the shots in the markets.

One of the most predictable trends in life is how we tend to be less interested in new things as we age.

Music is fascinating to the young, while older fans dwell on the hits they once knew. Adventurous eaters eventually fall into a rut of five or eight favorite recipes. We begin to revisit resorts we know well over new places and new faces.

Staying out of that rut can be a restorative tonic in one’s later years. Reading new authors, eating exotic foods and visiting new lands is a good way to stay young.

Yet the very fact that we view change as a way “stay young” proves the point. We associate learning with youth and, illogically, age with knowledge, as if there’s nothing new to learn after 40 or 50 years on this Earth.

There is one very clear counter-trend. It usually isn’t until early middle age that people start to wake up and pay attention to their finances. Looking down the road 20 years to a retirement party is a motivator, of course.

But many middle-aged savers come into learning about money as a secondary effect of following the news. We feel invested in the political and social arguments of our time, and money is bound up in all of these questions at some level.

Pretty soon, we look inward and begin to ask: Am I doing this right? Am I on track to a retirement of safety and comfort? Or one marked by risk and want?

Often, investors engage this question the way they do any “hard” problem in life. They study the topic on the fly, trying to learn who’s who and how their ideals fit into the mold being offered to them.

Am I a conservative investor? A trader? Something in-between? The first logical step seems to be to find a role model, someone to follow. We feel comfortable with mentors, so we seek them out in real life or, more often, through the media.

Where retirement investors get into trouble is right at the beginning of the process. They want badly to learn, to engage and to conquer what can be a complex topic.

Never mind that legions of people on Wall Street spent years earning licenses and passing exams to do the same thing. We amateurs want the quick version, over and done in a weekend. Then we want to log on to our chosen brokerage account and start trading!

Wall Street loves people like us. Trading drives commissions, which in turn drives bonuses for brokers. It also provides plenty of “dumb money” around which far more experienced investors are happy to trade.

As Warren Buffett once noted about card games, if you look around the room and can’t spot the patsy, that’s because it’s you. You’re the mark, the “dumb money.”

It’s great to put your mind to work on a new, complex task or subject. People should tackle a foreign language, learn an instrument or take up painting later in life. It’s mentally invigorating.

And some people can and should be deeply involved in their investments. If you have a knack for numbers — say you ran your own business for decades or just like studying the markets — well, you probably will do just fine, with some fundamental preparation.

But, fair warning: The market beats up experienced and savvy traders every day, some so badly that they limp out of the ring for good. It’s no place for beginners.

Investing boring? That’s a good sign

Nor should you feel obliged to find investing strategy interesting. Not everyone does. By far, the most effective long-term investments are the most boring — low-volatility stocks and indexes, sleepy collections of bonds and portfolios that don’t change for months.

The less you do in this business the better, for the most part. That’s why retirement investors should seriously consider “set it and forget it” passive indexing.

Break out some play money in a small account if you feel the need to get your blood pressure up. Or put your brain to better use by taking up a new sport or pastime instead.

It will be May soon, so you know what that means: An avalanche of articles with titles like the one above.

So, does the theory hold water? First, here’s how the “sell in May” idea is supposed to work.

Investors, it is presumed, will see a bump higher in stocks from Halloween through about May, then lower performance from that spring month through the following October. In general, we seem to be into the markets all winter and out all summer.

It’s an appealing thought. The idea that there’s a “secret” way to beat the market mechanically will always find an audience.

Yet academic investigators have found little evidence that it works consistently enough to matter. Rick Ferri took the argument to a long-term test and found it wanting, largely because of faulty assumptions regarding dividends and trading costs.

Essentially, the performance gap is narrow enough to be explained by wishful thinking. But you don’t need to do even that much work. You need only to understand the madness of crowds.

The trouble, in a nutshell, is that everyone already knows about the pattern and either tries to preempt it by selling sooner or use it to buy into the decline.

Some years, of course, it’s a disastrously bad idea to be out of the market by May. True believers write those years off as anomalies. Yet real investors get hurt by falling for the argument.

Rather, long-term investors should use short-term declines in stock values to buy in. The only way to achieve that goal consistently is to be consistent about your investing plan. If you buy monthly, always buy monthly. If you buy quarterly, stick with it. If you rebalance, be disciplined.

It’s a difficult idea to accept, intellectually, but lower prices for investments now do not signal the future value of your portfolio.

Nevertheless, people tend to mentally “mark to market” their retirement, even though they haven’t sold a single share. Similarly, they find lower prices unmotivating when they should be buying more.

Think about that: You have a chance to own more of a company at a lower price than just a few weeks ago. Presumably, nothing about the company has changed, right? It just went on sale.

If you were offered a $1,000 off a new car just for walking into the dealership that day, you would think of it as good news. If you went to the grocery store to buy dinner and got handed a 15% off coupon just for showing up, you’d be thrilled.

Sell in May and go away reconsidered

Investments are no different. As a retirement investor, you expect to be in the market for years, not days. If you are a retiree now, the small portion of your portfolio in stocks needs that same kind of forward thinking to do you any good.

Getting in at a better price and thus averaging down your entry point is an important strategy, one largely missed by market timers bent on outguessing everyone else at once.

Is the traditional 60/40 split between stocks and bonds — what financial planners call an “asset allocation model” — dead on arrival for retirement investors? In one sense, yes. But let’s not be hasty. The retirement stocks bonds mix can work.

The problem isn’t just low current bond yields, although that is a big problem. Nor is it stock market volatility, although short-term ups and downs seem to define the indexes these days.

No, the criticism of the 60/40 retirement stocks bonds mix is that it no longer applies at all, that it’s too simple an approach.

Let’s attack that second problem first.

Too simple? Probably. But put yourself in the shoes of a typical financial adviser. Two clients come in to see you each week on Friday — one in the morning, one in the afternoon.

The early client is a bond believer. You might be able to get him to move ever so slightly up the risk curve toward higher yield, but not by much. Stocks? What, are you crazy? No way he’s buying stocks. It’s bonds or cash all the way.

Your afternoon appointment is a wild-eyed trader. She wants equities stacked on equities, always angling for a hot tip to stick in the portfolio. Even blue-chip dividend plays bore her to tears. Investing for her is all about making a killing on appreciation.

You know that the bond buyer needs a hedge against inflation. The stock buyer would benefit from the stabilizing influence of a steadier return. What do you tell these very different people about their retirement stocks bonds mix that they might actually hear and accept?

So you, the financial adviser, have a sales job to do: You need to get these folks somewhat diversified without scaring them away as clients. Voila, the 60/40 model is the answer.

You tell the bond person not to worry, he will be mostly in bonds later on, and you point out that dividend stocks are like bonds in some ways — they offer income and relative safety. And you tell the stock jockey that bonds help her bank gains over time. Fixed income is like insurance, you explain, helping her avoid unnecessary volatility.

Everyone wins, right? Until now.

The typical argument for both sides of the retirement stocks bonds mix is in question, thanks to those low yields and the recent experience of the 2008-2009 crash. Bonds don’t pay and stocks don’t climb straight up anymore.

So, asset allocation is dead, right?

Nope, it just grew up. Asset allocation works fine, if you expand the model to match the best practices of major endowments and pension funds.

That means you own stocks, but not just the S&P 500 or the Dow. You own a calibrated mixture of U.S. major stocks, small caps, foreign developed country firms and emerging markets equities. You buy value plays but also growth-oriented issues and, of course, solid dividend-payers.

On the bond side, you own Treasuries via whole-market ETFs but also high-yield and foreign government debt. You get growth and income from real estate, too, and a slice of commodities to hedge against inflation.

Your retirement stocks bonds mix

Crucially, you own these investments not as curated “picks” that need to be fawned over by an active manager but through very broad, efficient ETFs and index funds. That brings you low cost and high liquidity, the perfect balance of performance and price.

Importantly, you and your adviser stop trying to “figure out” where the next million-dollar investment idea is coming from. Instead, as the market turns and bucks among asset classes, you actively rebalance your holdings, taking gains where they happen, selling high in order to buy low, over and over.

That means financial advisers have a new sales job to do: Retirement investors need to be re-educated as to why asset allocation works in the first place and why it still works as a retirement stocks bonds mix.

Not because of some magical mix of just two asset classes but of several, and because of a careful, thoughtful effort to use rebalancing to steadily compound savings into long-term wealth.