Regarding your house as an asset: One of the things I learned from reading books like Rich Dad, Poor Dad, is that if it is NOT bringing in income, it is not an asset. If it is costing you money it is a liability. So your house is actually a liability, not an asset. It only becomes an asset when it is sold. A lot of people don't understand this concept. So they overbuy in the hopes of making a profit down the road, only to run into trouble should the market tank at the time they need to sell.

Another, related, concept is that of "phantom wealth". This is what most retirement vehicles are based on. What I learned in economics class in college and what I have learned studying personal finance on my own, is that the value of something is driven by what the buyer is willing to pay, not the price the seller puts on it. Now when it comes to necessities like food and energy you are pretty much at the whim of the seller because there really aren't any alternatives for these things. Investing in the market, on the other hand, is optional. So if there are no or few buyers, the price has to go down. What this means is that you may have X amount of dollars in your 401k on paper, but when it comes time to start withdrawing, if the market is not good, you aren't going to get as much as what you thought you had. Back in the mid-90's I "lost" $17,000 in pension funds due to some shenanigans by a dishonest CEO who ran a thriving company into the ground six months after he took over the reins. In January my statement said that the paper I held in company stock was worth $17,000; by July those same pieces of paper were worth less than toilet paper and not nearly so useful! That's phantom wealth.

I am afraid that there is going to be a reckoning down the road, because the only way we can keep things like 401k's and even Social Security going is if there are more people paying in (buying) than there are people taking out. When places are hurting for workers, that means less people paying in to the system. Younger workers also frequently don't have the money to put aside in 401k's either. I've had quite a few discussions with coworkers lately about retirement. I think my generation (Boomers) will be the last to really retire. I also see some of my younger and not-so-younger colleagues make some really scary financial decisions, I mean some really, really bad stuff; they're living paycheck to paycheck, in debt, poor credit rating, bankruptcies, missed payments. This stuff has a nasty habit of catching up to you when you can least deal with it. "Oh, but I've got time to turn things around." Not really.

I could write a whole lot more on this subject, such as the industries and institutions that prey on poor people (and there are a LOT of them). I am going into retirement in a lot better shape than most of my peers and that is because I made a deliberate choice to avoid some of the bad choices they made. There are people I don't look upon with envy; these are the people who have gotten involved with drugs/alcohol, had run-ins with the law, or are struggling to raise children on their own while drifting in and out of a series of bad relationships. No, I don't say "But for the grace of God there go I" when I hear these stories. I don't find anything attractive about that kind of life at all.