In a new book named ‘Lifecycle Investing: A New, Safe, and Audacious Way to Improve the Performance of Your Retirement Portfolio,’ Yale professors Ian Ayres and Barry Nalebuff, alleged economists at the University, recommend that people borrow money to invest for their retirements.

It just shows you scoring good on test doesn’t guarantee you have and common sense or knowledge.

Of course since being an economist has nothing to do with knowing how to invest, that fact is irrelevant to their suggestion, as the suggestion itself shows.

Anyone with a tiny bit of common sense knows this is a ridiculous idea, and it won’t work for the vast majority of people, and in fact, would cause them more harm than good financially.

The bottom line in their recommendation is that in the early stages of a person’s life they don’t invest like they should, so they’ll have to make up for it by borrowing money.

The very first fallacy of that argument is the idea you’re behind in something and so you have to catch up by taking even more risk. It doesn’t matter what area of life it is, when you develop that mentality, you’re setting yourself up for failure, as the increased risk of course means you’re increasing the possibility of failure.

In essence they’re saying you have to buy back time, but that is also not that impressive, as the extra cost of buying back that time, is partially eliminated by the cost of the capital to invest in the first place.

While we know in the U.S. money is about as cheap as you can get, it still takes away from your overall investment, and increases the cost before you have a chance to win or lose.

At a young age, it’s best to simply put as much as possible into your 401(k) accounts to get the top match from your employer, and to invest as much as possible in any IRA you have that is sheltered from taxes.

Probably most important, is there is so much discipline and knowledge required to make this happen, that the average person can in no way make it work, and so it should be thrown aside as a legitimate way to prepare for your retirement.

I don’t care what their arguments or logic is, this is just a really bad idea, and when you’re young the last thing you need to do is use a margin account of some sort to invest over the long term.

If you have that type of discipline and knowledge, you already are ready to invest in the usual retirement vehicles without the added expense and risk of borrowed money. Don’t waste your time, energy and money on this foolish advice.

It might appear that this is for those who are younger and have time to follow the advice given, but it is never too late to begin planning to make your dreams come true.

Plan early for it. Not just in the financial way, but in the planning for enjoyment part, too. Once you have written down your financial goals for retirement, write down goals for things that you want to do as a part of retirement. Do not be afraid to put things on your list that you might think are too big. You will never know what you can achieve until you are willing to dream about and plan for it.

Reduce your debt as you go. This doesn’t mean just paying off your house. You must work towards debt freedom throughout all of your life. Imagine being able to retire with no debt other than monthly recurring expenses. Then, the income from your retirement will sustain you easily.

Invest in 401k and IRA accounts. Begin early and invest often and generously. If you are young, your savings will add up quickly and by the time you get to retirement age, you will have more than enough to draw on and use to support you throughout all of your retirement.

Plan to give to others. Once you find that all of your needs are cared for, be sure to have a will in order to pass on anything you leave behind. Or, if you so desire, look for organizations and opportunities to which you can give money. Philanthropy has its own rewards in the satisfaction that it provides those who give generously to see a goal met or need covered.

Refuse to sit still. You might be like some and find that retirement bores you. Find something to which you can give your time. It could be a second career or something that you always wanted to pursue but making a career change before never made financial sense. There are opportunities all around you.

You might even consider getting involved in the Small Business Administration and help fledgling businesses make wise choices and use their resources wisely as they benefit from your years of experience.

Remember that retirement does not mean sitting in a rocking chair the rest of your life. It means making the best of the time that you have now that your primary career is over and your retirement has officially begun. Indeed it can be the best time of your life.

Good savings accounts are sometimes hard to find. You can usually find the best rates at an online bank but you have to also be aware of other factors such as whether there’s a minimum balance requirement or whether there are monthly fees if you fall below a certain amount. These days you should also do a background check on every bank to see if it’s in any sort of financial trouble.

Home owners insurance. Due to market fluctuations, your house might be worth less than it was even a year ago. While that looks badly, the thing to keep in mind is that you are probably paying home owners insurance on the higher amount at which the house was valued. You are advised to look at the policy and adjust down the coverage amount if it makes sense. You can save hundreds of dollars by doing this. If your house is paid for, review your policy and make sure you are not paying for too much insurance based on the fact that you only need to replace the house with a residence that will serve your needs, not a palace.

Grocery Shopping. The biggest area that everyone gets caught up in is impulse buying. If you have a strategy to reduce or eliminate this, you can save a significant amount of money. First, have a list when you go shopping. Do not deviate from that list unless absolutely necessary. Ask if you can wait on the purchase until later. That will at least get you out of the store without making the purchase. Later on, you will be amazed at how reality sets in and you really do not need it as badly as you thought you did when you were standing in front of the display (blame it on the slick marketing). Next, go shopping less often. We are used to jumping in the car and running to the store whenever we need just one or two items. If they are not mandatory, you can put them on your list for later.

Prescription drugs. Generics – check into them. Often times, doctors are not asked about generics for the medications that are prescribed. The first rule of saving money here is in asking. Next, if there are no generics available, ask your doctor if there is an alternative drug which will accomplish the same treatment, but does have a generic. Some doctors are influenced by the drug sales reps and like to push the meds for which they are being rewarded financially, so it never hurts to ask.

Do not lend money to family. Here is one that has come back to hurt so many retirees. It is such a strong emotional issue that often times the desire to help a family member overrides common sense. This is your money for your retirement. If you give it away, then you might not see it again. And think about how that will drive a wedge between family members. So, the best advice is to refuse to do this. Or if you do, then consider it a gift (whether or not you tell them) and do not ever expect to see it again.

Travel package deals. Look around and compare prices. Just because you are buying a package targeted at seniors does not mean that you are getting the best prices on travel. Always compare prices and you might be surprised at what you find.

These are simple things, but can save so much money. Not only that, but they will make your retirement years that much more enjoyable.