Focus on the "Okay." Forget About "Perfect."

The lament of New York Times columnist Joe Nocera is one I hear a lot:

" "... "The bull market ended with the bursting of that bubble in 2000. My tech-laden portfolio was cut in half. A half-dozen years later, I got divorced, cutting my 401(k) in half again. A few years after that, I bought a house that needed some costly renovations. Since my retirement account was now hopelessly inadequate for actual retirement, I reasoned that I might as well get some use out of the money while I could. So I threw another chunk of my 401(k) at the renovation. That's where I stand today." ...

Everybody has their own sob story. Twenty-four years ago, mine was: $350 a week job. No benefits. Fifty-hour weeks.

A year later I landed a union gig under a TAG contract that almost tripled my salary. Nine months later, the studio went out of business and I was unemployed again. Nine months after that, I ran for union business representative (over my wife's bitter opposition) and finally started to save a bit of money.

I was forty years old.

The Mrs. and I have been saving ever since. We've made good moves and bad moves, but the one thing we've learned as we've grown older is to avoid concentrating bets (no stocks, but lots diversified mutual funds), and to keep things conservative (lots of bonds.) When you're on the cusp of geezerhood and have built up a stash, it's a good idea to preserve capital.

The biggest mistakes investors make is A) chasing hot investments, and B) freaking out and bailing when investments go south. As Tim McAleenan at Seeking Alpha observes:

Nocera's certainly not the only person who owned too many tech stocks in the late 1990s and got burned, ... But what caught my attention was this: Since my retirement account was now hopelessly inadequate for actual retirement, I reasoned that I might as well get some use out of the money while I could. So I threw another chunk of my 401(k) at the renovation. That is the kind of logic that I want to go to great lengths to avoid....

Not being the smartest investor west of the Mississippi isn't what will bring you down. It's making stupid moves, over and over again. If you can avoid the dumb mistakes, and stick to a sensible investment plan, you'll end up fine.

And if you don't start putting money away? Then Dr. William J. Bernstein has a think-piece for you. It's called "A Nation of Wal-Mart Greeters." Yeowch.