Winning the World Series of Retirement Saving

10/25/2013 07:36 pm ET | Updated Dec 25, 2013

Every sport has its own character. Football is often punctuated by violence. Basketball is highlighted by feats of jaw-dropping athleticism. In baseball, the phrase that comes up often is "grind it out." That's why baseball is the sport most like retirement saving.

As the Red Sox and Cardinals square off in the World Series, viewers will be reminded by announcers of how baseball is the ultimate grind-it-out sport. Batters grind out at-bats. Pitchers grind out wins. Teams grind out seasons. In the same way, retirement saving is a matter of diligent sacrifice played out over a very long period of time. Here are five specific ways baseball is like retirement saving.

  1. It's a very long season. Pro football has a regular season of 16 games. In basketball, it's 82 games. The baseball season is a grueling 162 games. That's why baseball players are taught not to get too high or too low on any given day -- it's not that kind of rah-rah sport. Similarly, you have to take the long view of retirement saving. Don't get too excited every time the market goes up, or crushed when it goes down. Just do your job day after day: Make your retirement plan contributions, and monitor your investments carefully. Do the right things day-to-day, and the long-term will take care of itself.
  2. The post-season has gotten longer and longer. It's not just the regular season that's long in baseball -- the post-season has gotten more and more stretched out. Until 1969, baseball had just one annual post-season series: the World Series, played between the regular season champions of the American and National Leagues. Since then, divisions and wild cards have been created, adding multiple layers to the post-season. Think of retirement as the post-season to your career -- it too has gotten longer over time. Average life expectancy was under 50 years at the beginning of the 20th century, and is approaching 80 years now. Accordingly, people today have to plan on their retirement savings lasting longer than ever.
  3. You need a deep roster. The long season takes its toll of injury and fatigue, so all 25 men on a baseball team's roster have to contribute. You also need a deep roster of retirement savings to save enough to give you a cushion against setbacks. Setting up a well-stocked emergency fund in a separate place from your retirement savings -- high-interest savings accounts can be a good choice for this -- can help prevent emergencies from depleting your retirement funds.
  4. You need a collection of complementary parts. Baseball teams have starting pitchers and relief specialists, left-handed and right-handed batters, and various other role players. Your investment portfolio needs to be the same -- not concentrated too much in one area, but diversified into pieces that perform different functions.
  5. Losing is part of the game. Top football teams lose only a handful of games a season. Top basketball teams lose maybe a couple dozen. However, playoff baseball teams can expect to lose 60 or 70 games. Investing is like that too: It's not about being perfect, but it is about winning more than you lose over the long haul, and never letting your losses get out of control.

Making a 401(k) contribution when money is tight and retirement seems far away can seem like a thankless sacrifice. Just remember that in trying to get to the World Series of retirement saving, you will only be successful if you grind it out one contribution at a time.