Before she passed away a few years ago, my mother told me I was bossy and a nag, and I have to admit, she was right! Specifically, I admit that I am maybe the world's worst nag on the subject of financial do's and don'ts to my friends and family.

However, I have a good excuse. For as long as I've been in the investment world, I have witnessed countless, seemingly small mistakes and omissions that people have made that ultimately turn into gigantic, colossal financial disasters. And the worst part is that most of these blunders – if caught or avoided early on – can actually result in tremendous opportunities to radically increase your financial stature.

Case in point: not opening and regularly contributing to a retirement plan. The Employee Benefit Research Institute found that just 33.1% of workers, aged 21 to 64, have a 401(k) plan and a mere 23% own an individual retirement account (IRA).

Those figures are absolutely amazing to me, especially in light of the Bureau of Labor and Statistics, that only some 11% – less than 30,000 – employers now offer their employees a pension plan. That's down from 112,000 in 1995. To add more salt to that wound, need I remind you that the old, fail-safe Social Security plan is in deep trouble. A recent article in Fortune magazine analyzed the latest Social Security Trustee's Report, concluding that by 2016 or 2017, the plan will be all but bankrupt. Yep, that's just around the corner, so don't count on that monthly stipend for your golden years either.

Now, I realize I have covered this subject before in Financially Fit. But since our country is beset by severe economic woes, an uncertain election climate, and accelerating, as well as fierce, international competition, I'm going to "nag" you once again, as I believe it is imperative that folks take control of their financial future. And opening and contributing to a retirement account is crucial.

First of all, if you have access to a 401(k) plan, that's your first step. I recommend that you fully fund it, then move on to an IRA, which is what I want to address today.

Here are the current IRA contribution limits:

Year                        Contribution limit
2008                           $5,000
2009 (and after)          $5,000

After 2008, the limit will be adjusted for inflation in $500 increments. In addition to these contribution limits, workers age 50 and older (as of the end of the year) will be able to make "catch-up" annual contributions of $1,000 per year.

Traditional IRAs – if you meet the income requirements – allow you to contribute pre-tax dollars. Roth IRAs, which came along in 1998, offer several advantages over traditional plans.

They are funded with after-tax dollars, so you owe no taxes on your withdrawals (including earnings), as long as the withdrawals are qualified (primarily meaning after age 59.5, and if you have owned the IRA for at least five years). So while you forfeit any tax advantages in the current year, you should more than make up for it by avoiding taxes on your principal and earnings when you withdraw them.

Additionally, special circumstances, such as the first-time purchase of a home, disability, unreimbursed medical expenses more than 7.5% of your adjusted gross income, qualified higher-education expenses, and a few others may allow you to make tax-free and penalty-free withdrawals from a Roth IRA. This makes the Roth IRA an attractive investment vehicle for many other uses in addition to retirement and savings.

And because the annual income levels used for determining your ability to make contributions are much higher for a Roth IRA than in a traditional plan, more folks can participate.

In order to receive full deductibility in a traditional IRA for the 2008 tax year, individual taxpayers must earn less than $53,000 and married taxpayers less than $85,000. Partial deductibility is available for incomes up to $63,000 and $105,000, respectively.

But in a Roth IRA, individuals making less than $114,000 and married taxpayers filing jointly who make less than $166,000 can make at least a partial contribution to a Roth for the 2007 tax year. For a full contribution, the income limits are $99,000 and $156,000, for single and married taxpayers filing jointly, respectively.

And unlike a regular IRA, the Roth IRA doesn't require minimum withdrawals when you reach age 70.5.

Lastly, lest you think IRAs are limited to just stocks and bonds, you may be surprised to find out that in a truly self-directed IRA, the IRS actually has allowed investments in such oddities as cattle, cemeteries, railroad cars, restaurants, independent film companies, and numerous real estate ventures. Some vehicles they have prohibited include artwork, vacation homes (if used for family pleasure), jewelry, and life insurance. And you can forget about collectibles, such as art, rugs, stamps, antiques, and gems – they are a big "no-no." But a word of warning: before you decide to throw something other than stocks and bonds into your IRA, please consult your tax advisor!

For more information, here are a couple of websites you may want to visit:

http://www.irs.gov/faqs/faq17-3.html

http://www.irs.gov/retirement/article/0,,id=111413,00.html#invest

As always, I encourage you to first fully fund your 401(k), and then get started on your IRA. Remember, the only person you can count on to make sure your golden years are all you wish for is yourself. And a little steady contribution in your early years will compound so fast that you just won't believe how much you can accumulate over time.