This month's (the May issue) Money magazine has an article about one family and how they are planning to pay for their son's college education. The son is 18 and will be starting college in the fall. They have saved just $9,500. The husband is 55 and the wife is 52. They earn $110,000/year. Also, they have saved less than $40,000 for retirement but expect to need about $1 million to retire by age 65. I think this is just the kind of family we are often talking about here. Good income but lousy savings. The article does say they had "unexpected family expenses" but didn't give any details. The article also said that the average American family has saved less than $7,000 for college by the time their child is in high school. The exact amount was $6,625. Sorry, but even if you go to a state school, 7K isn't going to get you too far. Plus, how the heck do these folks expect to go from 40K to 1 million in retirement funds in the next 10 years? They would need to save about 50% of their gross income each month and earn a 10% return on their money to end up with $1 million at age 65. That ain't gonna happen. If they could invest 20% of income, a more reasonable possibility, and earn 8% which is doable, they would end up with about 425K, less than half of their expected need. Dad is quoted as saying, "Should we have saved more? Yes, absolutely. I wouldn't call us terrific financial planners, but the bottom line is, we'll find a way." If anyone knows a way to turn 40K into a million in 10 years, let me know. I'm a pretty optimistic guy, but I really wonder what is going to happen to the baby boomers over the next 2 decades as they reach retirement with inadequate savings.