Do you often lose sleep, or hair, predicting the size of your nest egg? Everyone recognizes the need to save for retirement, but very few of us feel comfortable with the amount we are actually able to consistently invest for our future. So how do your saving habits compare with the average individual?

Every three years the Congressional Research Service Department of the Library of Congress publishes data containing statistics and trends concerning Americans’ savings and retirement patterns. It should be noted that the most recent information was published in May 2006 and utilizes data collected in 2004. However, considering the urgency of this topic (and that a new study with 2007 data will not be available until mid 2009), it is worthwhile to examine the insights that can be extrapolated from the 2006 survey. The table at the bottom of the page from the 2006 survey indicates total retirement savings at the household level.

While many might be surprised by the low percentage of households that contribute to a retirement plan, and by the low average account balances that Americans will rely on for support throughout retirement, there is an equally shocking and alarming trend that is not conveyed in the table. The overall percentage of households that maintain a retirement account actually diminished to 50.2 percent in 2004 from 53.4 percent in 2001. Thus, by one unfortunate measure, any individual who currently contributes to a retirement account is ahead of the curve.

So, how well prepared for retirement is the typical American? Let’s consider a 65-year-old retirement account participant with an account balance of $250,000. According to the National Vital Statistics Report published by the Centers for Disease Control and Prevention, a 65-year-old individual can expect to live another 18.7 years. Assuming an investment return of 10 percent (near average for the S&P 500 since inception) and inflation of 3 percent, the retiree’s household will have an inflation-adjusted income of $24,012 throughout his or her life expectancy.

Before analyzing whether an inflation-adjusted annual income of $24,012 will be enough to support your family, consider that our hypothetical retiree’s nest egg is 100 percent invested in a market index. Traditionally, financial planners would recommend that individuals continually shift a larger proportion (as much as 80 percent) of their retirement dollars to less risky investments as they age because a retiree’s investment horizon is too short to endure the vast fluctuations that the stock market often experiences. Less risk equates to less return. Thus, reducing the proportion of your investments in the stock market (reducing risk), although sound financial planning, will reduce the expected return. Additionally, this retirement account will provide no income beyond the retiree’s life expectancy and if the individual lives any more than 18.7 additional years, there will be no funds left in the account to pay for funeral expenses or to pass to the retiree’s heirs.

Sound like the plush retirement you were hoping for? Fortunately, it’s never too late to beat the averages. With the wide array of IRAs, 401k plans and other tax-advantaged investment vehicles available, investors have ample opportunities to invest for a bright future. Consult your financial advisor to get started or give your retirement investments a shot in the arm. Wise decisions now may even enable those hair implants to become a reality, or at least allow you to sleep more soundly.