And for those of you on the younger side of this discussion. Some don'ts and do's from personal experience:
Don't Divorce: In a community property state, yet net worth dropped appx 70 percent each time, through more than 1 divorce. Especially the last one in my early 50's. Choose wisely, stay married.
Don't listen to anyone who tells you not to buy your own home. Find a way to buy a home. Of course, keep the monthly payments in your budget. And yes, that often means buying a home that isn't your dream.
Do - Invest in real estate. If you can handle the work / 3 am calls: Rental houses: Did VERY well with rental houses over more than 20 years. If not, there are other ways. But for those, research very carefully before investing. Some REIT's lost money even through very good real estate markets.
Don't sell your rental houses to buy a friends business, the year before the worst recession in 100 years, when you are 50. With last divorce a year later.
Do: Keep moving forward, no matter what. Even though net worth dropped from $1.4 million in 2005 to $40,000 by January 2011. Kept moving forward. As said by many here: Spend less than you earn, save, buy used but nice cars and take care of them, and plan. I won't have the low end millionaire retirement planned when in my late 40's. But now 64, scraped up a down payment to buy a home in 2012, now reverse mortgaging the home (if you can't pay it off due to dumb decisions or life challenges, at current interest rates, reverse is not a bad way to go), have a fair 401K built up, have no credit card debt. And yes, remarried, chose wiser this time.
Moral of the story is that even if you get unlucky, or make bad decisions, it is never too late to right the ship, work hard, and still plan for a decent retirement.
