(FORTUNE Magazine) – No pat advice. No "five easy steps." No quick-hit worksheets that tell you what you already know. Forget them all.

Retirement planning isn't something you pick up in a brochure sent with your brokerage statement. It's an individual training regimen. A marathon test of wills between you and your checkbook. And trust us, the saving and investing strategy that may be ideal for a married, 42-year-old middle manager with three school-age kids is not likely to be the best tack for a 34-year-old stock-optioned Netizen or a 56-year-old business owner with health concerns. This contest is one-on-one. That is, you against the clock.

So this year we've really raised the bar in our annual retirement guide. We've given a rare gift to ten living, breathing FORTUNE readers, all of whom fantasize about retiring not just comfortably, but while they're still young. In exchange for sharing with us their very private fears, dreams, and financial circumstances--including the shockingly scant amount of 401(k) money one has managed to squirrel away and the piles of debt another has accumulated--we've plotted out for them the best retirement strategies money can buy. At FORTUNE's invitation, the country's leading financial experts have devised detailed, personalized plans for each individual or couple, with the goal of having them quit the rat race early--or at least years ahead of what they might have expected.

Making those financial plans not just doable but reasonably agony-free was no easy assignment. Getting ready for retirement is an endeavor fraught with nasty tradeoffs: Spend the whole vacation kitty in St. Kitts or bank some of it away? Trot to the office on that glorious sunny weekend or relax at home with the kids? As Chatham, N.J., financial planner David Bugen sums it up, "Life's a balance between enjoying today and securing tomorrow."

But hey, that doesn't mean you can't jigger the scales a bit. And that's what this undertaking is all about. Choosing the right savings vehicles, the right tax plans, the right investment allocations, insurance policies, tuition programs, stocks, and mutual funds now can help turn a modest nest egg into a much larger one down the line. The sport of early retirement, in fact, is often as much about strategy as it is about savings. And the good news is that the outcome may depend on your cleverness and aggressive action going forward even more than on your discipline in the past.

Here, then, are seven real-life playbooks to whisk you to the winner's circle. Chances are, one of them is right for you.

Carolyn Robinson THE ENTREPRENEUR

GOAL: Retire by age 50; start two businesses

CHALLENGES: $150,000 in investment assets is too heavily concentrated in select growth stocks; needs to diversify holdings and keep some liquid assets for current ventures.

The last thing Carolyn Robinson would consider herself is a gambler. Raised by her great-grandparents in rural Virginia, the 34-year-old credit analyst says the only things she was taught about money were to save it and to have an insurance policy. But when her employer, First Union, transferred her entire division to Charlotte, N.C., from Richmond recently, Robinson made the gamble of her life: She decided not to go along. Her plan instead is to complete her MBA this December at Virginia Commonwealth University, where she's been taking night classes, and try out two startup ideas: a personal-shopping venture, which she hopes to expand into events planning, and a business advising people who want to set up their own investment clubs. "The entrepreneurial bug has bitten me," she says.

Though seemingly unrelated, each business draws on Robinson's personal strengths. She loves to shop and isn't above getting down on her hands and knees to paw through sale merchandise in search of bargains. "I like clothes, but I like them on sale," she says. She's also the one friends seek out for advice on what to buy wives, boyfriends, and significant others for wedding anniversaries, birthdays, and sundry occasions. As for the investment-club consultancy, seven years ago she and a friend started their own stock-buying group--which has been so successful it won a club-of-the-year award from the Coalition of Black Investors.

She had planned to retire by 50, but now she is wondering whether that is a realistic goal given her latest career move. "This is a curve ball," she admits.

For some answers, FORTUNE turned to Deena Katz, a partner in the Coral Gables, Fla., financial advisory firm Evensky Brown & Katz and editor-in-chief of the Journal of Retirement Planning. Her task was made more complex by the fact that Carolyn, though recently married, has led essentially a separate financial life from her husband, Nathaniel Jr., 33--even living apart weekdays. She owns a house in Richmond, and he, an active military man, rents an apartment in Fayetteville, N.C., near his base at Fort Bragg.

So, for example, Katz assumes in her analysis that Carolyn will be covered under Nathaniel's medical plan, an expenditure she would otherwise need to include in the startup costs for her businesses. On the other hand, Katz recommends that Carolyn keep around $10,000 in a money market account to cover expenses while she is getting her businesses off the ground, when in fact she may not need to rely solely on her own resources.

Once she has some discretionary income to invest, she should plow as much of it as possible into a tax-sheltered account before she adds to her taxable investments. Steven Lockwood of Lockwood Pension Services in New York suggests that Carolyn set up her own profit-sharing Keogh plan. That will enable her to save up to 15% of her pretax earnings each year, up to a certain maximum amount, adjusted annually (it's $170,000 for 2000). The beauty of a Keogh is that, unlike with some other retirement plans for the self-employed, you aren't required to contribute annually. You can skip a year if you don't have the funds. "You never want someone starting out to lock themselves into a retirement plan," says Lockwood.

Of course, a large part of saving for retirement involves protecting what you already have. So Carolyn needs to make sure she has adequate property and liability insurance for her new ventures. Since she'll be working out of her house, she'll be covered for property and general-liability losses under her homeowner's policy until her revenues top $5,000 annually, says Loretta Worters, a vice president of the Insurance Information Institute in New York. After that, she'll need a separate business owner's policy (minimum cost: $500 a year) and quite possibly a professional liability policy, which could run her $750 a year.

The next step, says Katz, is for Carolyn to reallocate her $150,000 in investment assets--almost all of which is now in large-cap domestic equities, particularly growth stocks. This includes two of her IRAs, amounting to more than $50,000, which she had planned to switch from balanced funds to growth funds. As it is, Katz notes, there's significant overlap in Carolyn's holdings. For example, at press time the T. Rowe Price Growth stock fund, in which Carolyn has invested her $27,000 SEP IRA, and her $18,000 individual stock portfolio both included significant stakes in Intel and Pfizer.

"While she is accumulating assets, high equity exposure is a good decision," observes Katz, "but she is making a big bet on growth. For long-term savings it is best to diversify into core [S&P 500] and value stocks as well." The planner suggests that Carolyn rebalance her portfolio (25% small-cap, 25% international, 50% large-cap stocks) around a stable of good-quality index funds--such as Vanguard's S&P 500, small-cap, international growth, and international value index funds. She also notes that Carolyn has excess cash that should be invested in the allocation--with the exception of the $10,000 earmarked for expenses during her business startups, and an additional $2,000 emergency fund, which should be safely stowed in money market funds.

If the young entrepreneur earns enough from her businesses to cover her living expenses until retirement, and if she has the nerves to maintain a potentially volatile all-equity portfolio, then she should be able to retire at 50 as she had hoped, predicts Katz.

Those are big ifs, but Carolyn is optimistic. She is debt-free except for her home mortgage. And she enjoys the challenge of keeping her everyday living expenses under $20,000 (yes, $20,000!) a year, shopping at the PX, scouring the stores for sales--and, now that she's quit her office job, saying goodbye to her $800-a-year dry-cleaning bill. "Sometimes it's not so much what you earn," she says wisely, "but what you don't spend."

Jeffrey and Nadia Roberts THE EARLY BIRDS

GOALS: Retire no later than 60 with enough money to provide for daughter's education

CHALLENGES: Would love to save more, but first have to pay off high-interest debt; need to rejigger their several college savings accounts.

The Roberts are in a classic bind. Jeffrey, 29, is an associate product manager for the Hunts canned-tomato business at ConAgra Grocery Products in Irvine, Calif. Nadia, 26, is a stay-at-home mom with a postgraduate business degree from a university in her native Prague. They want to provide a topnotch education for their 11-month-old daughter, Katja. "I'd like to be able to send her to Harvard if she wants to go to Harvard," says Jeff. "At the same time, however, I am very desperate to retire early [in his early 50s--60 at the latest] and become the protege of Jimmy Buffett." Jeff, a former officer in the Air Force, has a pilot's license and dreams of spending more time in the sky during retirement. If he works, it would be because he wants to, not because he has to. "I love cheeseburgers and margaritas," he says. "All I need to learn next is how to sing and manage our financial assets in order to turn the dream into reality."

For help--with the money part, not the vocals--FORTUNE turned to New York planner Gary Schatsky, head of the National Association of Personal Financial Advisors, an organization of fee-only planners. Schatsky's first piece of advice: If Jeff wants to retire early, he must maximize his contributions to his employer's 401(k) plan. He's currently contributing just 6% of his $70,000-plus salary. (Contributions have been going into an S&P 500-stock index fund; ConAgra matches part of them in company stock.) He could, and should, be contributing 10%.

Schatsky's second piece of advice: Pay off the car loan. The Roberts have two years to go on a $5,000 car loan, and their variable rate just shot up to 9.6%. That, combined with the fact that the interest isn't deductible, means they'd have to earn nearly 14% on the money freed up by having the loan just to break even (assuming a 31% tax rate). "Why take that risk?" asks Schatsky. Simply paying down debt can be more lucrative in the long run.

If the Roberts feel they don't have the cash to do either of those things right now, they should make adjustments. "These are once-in-a-lifetime opportunities," says Schatsky. "You can't catch up next year." For example, they're currently repaying Jeff's parents money they borrowed to buy a townhouse in January ($400 a month over three years), even though the parents said to consider it a gift. Although it is admirable to want to pay them back quickly, says Schatsky, doing so is not a smart financial move. They should delay making those payments until the retirement plan is fully funded and the car loan is paid off.

Besides, they'll soon be racking up more debt as Jeff starts night school at the University of Southern California in pursuit of his MBA. The tab: $60,000 over three years. Luckily, Jeff's employer will pay half. Another help: Because they earn less than $80,000 (the threshold for a married couple filing jointly), the Roberts should qualify for the Lifetime Learning Credit. That will shave $1,000 off their tax bill, or 20% of tuition expenses up to $5,000.

As for Katja's college savings, the Roberts have $600 in an education IRA, invested in a Vanguard growth-stock index fund. They also put $100 a month in a Uniform Transfers to Minors Act (UTMA) account, invested in Janus Global Life Sciences stock fund. Schatsky recommends idling the education IRA (you can put only $500 a year in those, hardly enough to pay for Harvard) and instead investing through California's Section 529 plan. It is run by low-cost provider TIAA-CREF, and parents can contribute up to $162,000, depending on the child's age. (For more information, see "Letting Uncle Sam Help Pay for College" in the fortune.com archive.)

The UTMA has some attributes that make it worth keeping; namely, it is simple and has certain tax advantages. Because the account belongs to the child, the first $700 of income is tax-free, and the next $700 is taxed at the child's rate (generally 15% for ordinary income, or 10% for long-term capital gains). The disadvantage? The money belongs to the child and so is hers to use for whatever she wants, including buying a sports car, when she becomes an adult. The Roberts have invested Katja's UTMA in an aggressive health-care sector fund. "That's not the place to make a sector bet," says Tim Kochis of Kochis Fitz, a San Francisco-based financial planning and advisory firm for the wealthy. They'd be better off putting that money in a more diversified portfolio of equities, starting with an S&P 500 index fund, and eventually expanding into small-cap and overseas stocks. Stay away from exchange-traded funds, Kochis adds. Although ETFs, as they're called, have their advantages, their commissions make them inappropriate for a sequence of monthly purchases such as this.

Nobody said affording Harvard would be easy. But all the effort could pay off big-time. Says Schatsky: "A good education for Katja could be a better investment for the parents' retirement than any stock."

Dida Kutz THE LAPSED GRAD STUDENT

GOAL: Retire to Malaysia; do nothing but dive

CHALLENGES: Biggest asset is risky real estate. She needs to curtail spending and pump up savings across the board; also could use good health insurance after quitting work.

Dida Kutz dreams of spending her retirement years swimming with the fishes. "My passion is research diving," she explains. "I'm a lapsed graduate student. The appeal of being a poor biologist was strong."

So was eating, though, and eventually "reality sank in," says Kutz. While studying the molecular genetics of marine creatures at San Francisco State, she discovered she had a knack for making complicated things sound simple. So, answering the siren song of Silicon Valley, she entered the electronic publishing industry, shuttling between a variety of startups. She is now a tech writer for Xuma, a dot-com that makes and maintains e-business systems. She earns around $75,000 a year.

But the California crowd is young, and Kutz, now in her 40s and single, hopes to retire at age 50, far away from her apartment near the Golden Gate Bridge.

"There's a place in Malaysia," she says. "The diving is incredible. The reefs in the Indo-Pacific have some of the greatest biodiversity in the world." Living on the islands and diving in the coral wouldn't be expensive--Kutz says she could work part-time as a research diver for an organization such as the Nature Conservancy and also make tips from leading tourists on introductory dives. Based on conversations she's had with some American expatriates living there, she thinks she could live royally on $25,000 a year.

To create a source of income, Kutz recently purchased a house in a joint venture with a friend and has converted it into a rental property netting her $7,500 a year. She hasn't saved much toward retirement--buying the house knocked the value of her IRA down to $20,000--and, she says, she enjoys gourmet restaurants, expensive scuba gear, and travel. "I could live pretty simply," she says, or at least more frugally.

She'll have to if she wants to spend her retirement years under the waves of the Pacific, says Bruce Wertheim, senior tax manager in the financial planning group at KPMG, the big accounting firm. Because Kutz began her job at Xuma in February, she has only a few thousand dollars in her company 401(k). Wertheim says she should increase her annual contributions from $2,250 to $10,500, the maximum allowed by law. A $10,500 annual contribution could grow to $63,500 in five years, assuming a 7.5% rate of return, compounded monthly. And if Kutz focuses on limiting discretionary expenses, she could save an additional $14,000 a year outside her 401(k), which could grow to $79,500 in five years, assuming a 5% after-tax rate of return. Wertheim says he recommends a diversified portfolio for the investments. "It concerns me that most of her assets are in real estate," he says. While rental property can be a wise investment for retirement income, it also has its risks. Daniel Free, past president of the Society of Risk Management Consultants, recommends that Kutz purchase general-liability insurance and a commercial umbrella policy to cover her should one of her tenants get injured on her property.

Diving, too, has risks, but of a different kind. Kutz is a member of the Divers Alert Network, which would pay to airlift her out of Malaysia if she needs emergency medical attention. Health insurance is of more concern. Most early retirees can take advantage of COBRA--the federal law that allows you to pay to stay on your employer's health insurance plan for up to 18 months after leaving work--but after that, they're on their own until Medicare kicks in at age 65. The premiums for an individual policy vary wildly depending on age, location, and type of plan. A single person might pay anywhere from $100 to $300 a month, a young family or an older couple whose kids have left the nest $400 to $800 a month. That's for a good plan with a reasonable (read: $500) deductible. If you have health problems, the rates easily may be many times more. But at least you are guaranteed a policy as long as you apply within a certain window after leaving a group plan or COBRA. The point is, no one should leave a job that has health insurance without knowing where her coverage will come from next and what it will cost. "It's definitely a big-budget item," says Sara Hames, a certified employee-benefits specialist at T.E. Brennan in Milwaukee. "You have to plan for that."

Wertheim says that if Kutz spends less and saves more, she could retire in 2005, living on the interest from her after-tax investments, her rental income, part-time work diving in Malaysia, and perhaps freelancing if she needs additional cash. Health insurance will add to her expenses, but her income will be high enough to cover the premiums, especially if she remains healthy.

Should she want to move back to the U.S. after a decade or so in the Pacific, she could convert her rental property to a primary residence. Her retirement savings will have grown nicely in her absence, and she could start drawing from Social Security at age 62, and maybe leave a small inheritance for her niece and nephew.

If she does have to tap into her retirement accounts while still in Malaysia, watch out, says William Zink, an international tax partner at CPA firm Grant Thornton. If Kutz remains in Malaysia 183 days or more in a calendar year, Malaysia will tax her on that income. And because it was produced in the U.S., she wouldn't get a credit on her U.S. return for any Malaysian taxes paid. You can only get a credit for foreign taxes against foreign income.

Xuma is now privately owned, but if it does go public, Kutz will receive stock options. Wertheim says that only adds to her potential cash flow. "It could be the golden goose, or it could be nothing," he says. "I'd rather assume that it'll be nothing. Then if it works, it's gravy. She could buy Malaysia."

Lisbeth Wiley Chapman THE CAREGIVER

GOAL: Retire in next ten years; start another business

CHALLENGES: Got a late start saving, thanks in part to several career changes--and now has to aggressively grow her SEP IRA. She's also concerned about taking care of her elderly father.

"Everybody should envy me," laughs Lisbeth Wiley Chapman. In April the 56-year-old self-employed public relations specialist moved herself and her business from Boston to Wellfleet, Mass., near the tip of Cape Cod. Both are now housed in a 900-square-foot cottage inside a national park. Her office is a sun porch facing a marsh and woods where Chapman, a self-described "major big-league birder," can view the hawks and the orioles. She says the space fits all of her favorite things. The rest she has stored or given to her two sons, ages 30 and 26.

"I think I've downsized earlier than most," she says. But when her 87-year-old godmother, who owns the cottage, landed in a nursing home, she asked Chapman to look after the place. That allowed Chapman, who's been divorced for 12 years, to move closer to her as well as to her own father, 88, who lives nearby. His eyesight is failing, and Chapman likes to drop by regularly to take him shopping or mend his clothes.

It also gave her inspiration for her next business, Gardens of the Spirit, an organizer of spiritual conferences in gardens all over the world. She sees it as the perfect retirement career--not a huge income producer, but a great joy, combining her two passions, birds and gardening. She has no intention of leaving the public relations business anytime soon, but she does want to launch Gardens within the next two years as a sort of "third-time job," she says. As Gardens grows, she'll wind down her PR biz, which currently earns her around $150,000 annually, until the former replaces the latter as her full-time "job."

She believes she could live on $60,000 a year after taxes, just over half of what she spends today. The source of that income would be her SEP IRA, which she has increased from a mere $50,000 six years ago to $353,000 today. That includes her own generous contributions and some $225,000 in investment gains, generated in a handful of high-octane tech mutual funds. "I had waited way too long to start investing for retirement," Chapman explains. Placing all her chips on tech, she figured, was her only chance to catch up.

The bet paid off, but the question Chapman now faces is, What's the maximum she could withdraw each year in retirement without ever running out of money?

The folks at mutual fund company T. Rowe Price have devised a computer model to address that very question. Based on Chapman's answers to questions about her goals and preferences, the planners at T. Rowe, using the model, came up with a recommended income strategy. They assumed she'd start taking withdrawals in two years (the program is meant for people less than two years from retirement), at which point her balance would be just over $400,000 (assuming two additional years' worth of contributions on her part, but no additional growth). They also surmised that she'd need the money into her 90s, on the basis of her family's health history.

Their conclusion: Chapman could withdraw $1,170 a month and be 90% certain of never running out of money if she reallocates her portfolio to 40% stocks, 40% bonds, and 20% money market securities. So she is still way short of the nest egg she'll need to generate her desired monthly income of $5,000. Even if she keeps 80% of her portfolio in stocks and the rest in bonds, she'd gain only $120 a month, based on historical returns, and her chances of never outliving her money would drop to 85%.

How much, then, would she have to amass? The answer, says Christine Fahlund, the senior planner at T. Rowe, is around $1.7 million.

The good news is, Chapman is much further than two years away from retirement and so has many years of tax-deferred compounding to go before she'll tap her account. And she is a risk taker, determined to keep her portfolio in tech stocks rather than diversify into bonds or even international equities. "I'd rather be horsewhipped," she says.

Markman Capital Management's Bob Markman, both her current financial advisor and a client, says Chapman is an example of someone who could stay aggressively invested in retirement. "A lot of people get there by being aggressive but then turn off the engines," he says. Not her. Chapman intends to keep the pedal to the metal in her investments and in her life generally. A breast cancer survivor, she recently hired a personal trainer, bought a rowing machine, and now rows two to three times a day, six days a week. She gets much inspiration from her dad, who, despite his advancing age and near blindness, is "still going strong," she says, "so I expect to live at least to 108."

Art Goodwyn THE STOCK OPTIONEER

GOAL: Retire to the Virgin Islands, ASAP

CHALLENGES: Investments highly concentrated in Microsoft stock; new employer has no 401(k) plan; needs smart after-tax savings strategy.

The drama playing out in Redmond, Wash., over whether mighty Microsoft will be split in two is more than a sideshow for Art Goodwyn. It is the main event in his countdown to retirement. Goodwyn, 42, is a former Microsoft employee, and his early-retirement dreams are riding on his company stock--7,160 shares' worth, to be precise. He has 4,650 shares in a taxable account (the result of his having exercised employee stock options upon leaving the company) and 2,510 in his 401(k) account. (Goodwyn, a true believer, allocated 100% of his plan contributions to Microsoft stock.)

He was a lot closer to realizing his dreams in December, when the stock peaked at $120, pushing the market value of his shares to nearly $860,000. By the time a federal judge ordered the breakup of the software giant in June, the stock had plunged to $60, slicing the value of Goodwyn's nest egg in half. (It has since clawed its way back to $80.)

And that is bad news for Goodwyn, who wants to "make work an option" as soon as he possibly can because, he says simply, "I'm burning out." Since quitting Microsoft in 1996, he's had a series of hard-driving sales jobs in the information technology business, logging 60-plus-hour workweeks and 100 business flights a year. He rents rather than owns his house in Redondo Beach, Calif., because he's changed jobs so frequently--every two years, on average. His newest gig is with startup 7 Global, a British-based application service provider, where he's earning $100,000 a year, plus bonuses and stock options, doing business development for all of North America.

No wonder he longs to throttle back. Way back. "The idea is not total retirement," he explains, "but I'm not looking for a big job." What he's hoping to do is settle down on the Caribbean island of St. John and perhaps open an Internet cafe there. He figures he'd need around $300,000 to buy a house, $50,000 to start the business, and $50,000 a year to live on, after taxes.

He's consulted "so-called financial advisors" before, he says, but they've all just tried to sell him products and persuade him to amass an estate. "I don't really care what I have left when I die," says the lifelong bachelor. "I've got nobody I need to worry about but me." Not at the moment anyway. His parents are in good shape, financially and physically. Ditto his brothers.

So FORTUNE contacted Roy Ballentine, president of Ballentine Finn, a fee-only financial-planning and wealth-management firm in Wolfeboro, N.H. Ballentine specializes in helping clients with highly concentrated stock positions like Goodwyn's.

First, he crunched some numbers to see how much capital Goodwyn would need today to produce an annual income of $50,000 for life. He assumed the money would be invested in a standard, diversified mix of 65% equities and 35% bonds, and that returns would approximate historical returns. What he found? Ignoring Social Security benefits, any possible inheritance, and any income his Internet cafe might generate, Goodwyn would need $1.22 million today, after taxes, to be 80% certain of never running out of money. And that's not including the funds he'd need to buy a house or start a business.

Ballentine's advice: Forget the house and the business for now and focus on accumulating enough capital to fund retirement income needs. If Goodwyn has the stomach for it, Ballentine recommends that he hold tight to his Microsoft stock. "If the stock recovers, his asset value could double and he could have his dreams realized quickly," he says. "There's no other quick way to do that." If Goodwyn is losing heart and would prefer to diversify out of Microsoft, however, Ballentine recommends that he start with the 401(k), where selling stock won't incur any taxes.

Meanwhile, Goodwyn will need to continue saving part of his earned income. At his last job he plowed $10,000 a year into a 401(k), but his current employer doesn't offer an American retirement plan. Sure, Goodwyn could put $2,000 a year in a deductible IRA, says CPA Ed Slott, editor of Ed Slott's IRA Advisor newsletter. But that won't get him to the Caribbean anytime soon.

The question is, How much does Goodwyn now need to save, after taxes, to try to replicate the income stream he would have gotten from the 401(k) plan? For the answer, FORTUNE turned to New York pension consultant Steve Lockwood. Here's the story:

In his last job, Goodwyn's $10,000-a-year 401(k) contribution would have grown to $133,160 over eight years, assuming a 9% compound annual return. That translates to an annual retirement income of $7,800, after the payment of ordinary income taxes. Now, however, without a company-sponsored plan, that same investable $10,000 drops to just $6,500 after taxes (assuming a 35% tax rate). Sound tough? Well, believe it or not, he can still get there. That's because in order to get that same $7,800 in annual income from an after-tax portfolio (earning the same return), Goodwyn needs to amass only $99,870 over the next eight years, says Lockwood--not $133,160. The reason is that the bulk of his earnings, assuming the money is invested in growth stocks or index funds, would be taxed not at ordinary income rates but at lower, capital gains rates.

Even so, Goodwyn would have to invest $7,500 a year, or $1,000 more than his $6,500 in take-home pay. It won't be easy, but it's a small price to pay for a life of frozen pina coladas.

Edward and Maria Imperati THE DO-GOODERS

GOAL: To do missionary work six months a year

CHALLENGES: With a loan against their thrift plan, a second mortgage, and credit card debt, they have plenty of catching up to do. They also have to send their three kids to college.

Edward Imperati is looking for divine inspiration. A financial analyst at the U.S. Postal Service in Washington, D.C., Imperati, 47, sacrificed vacation time this summer to volunteer at a Connecticut retreat for inner-city kids run by Catholic nuns. If the volunteer life "clicks" for him, he says, he would like to spend six months a year in retirement doing missionary work around the world with his wife, Maria Del Pilar, 41, a USPS distribution clerk. "The first half of your life you spend working to do the things you want to do and provide for your family," says Imperati, a part-time graduate student in theology, "but I figure the second half should be spent giving back a little bit."

The Imperatis would like to retire early on around 100% of their current combined income of $133,000--but with three kids, ages 16, 11, and 9, and a few financial missteps in their past, they wonder whether they can afford it.

Worthington, Ohio, financial planner Jill Gianola applauds the Imperatis' plan to try out work they may wish to do in retirement. "Too many people focus solely on the financial pieces of the puzzle," she says.

On the plus side, the Imperatis have built up a healthy combined balance ($385,000) in their thrift savings plans--the federal government's version of a 401(k) for its employees. Even if they retire early, each will be eligible for a pension, a Social Security supplement, and retiree health benefits, says Gianola, who knows her way around the federal employee benefit system, having advised government workers in the past. On the minus side, she says, they have no college savings for their kids, and they have loans totaling $55,000 against their thrift savings plans, $10,000 in credit card debt, and a second mortgage on their house in Annandale, Va. They took a beating in the last real estate crash, and had to liquidate assets and borrow to cover expenses.

The bottom line: It will be difficult for the Imperatis to retire earlier than 2008, when Edward is 55 and Maria is 49, says Gianola, but that is still early by most standards. To succeed, they will need to repay loans so that they can free up funds for college tuition and their nest egg.

Currently the Imperatis contribute the max--10% of pay--to their thrift savings plans, and the government matches 80% of their first 5% of contributions. Their entire balance is invested in an S&P 500-stock index fund. The Postal Service is supposed to be adding new stock investment choices soon, including an international fund and a small-cap stock offering. When that happens, Gianola recommends that the Imperatis move 20% of their cash into the small-cap fund and 20% into the international, keeping the remainder in the S&P 500 fund. As they get closer to retirement, she says, they should start shifting into the government securities fund, with the goal of having about four years of living expenses in that fund (those not covered by their pensions and Social Security, that is).

Assuming the Imperatis keep maxing out their contributions to their thrift savings plans and earn 9% on that money--and assuming they pay off their plan loans and credit card debt within the next three years and earn 8% on that money--they should have enough assets, including pensions and Social Security, to last them until they're in their 90s, says Gianola. Their thrift plan balance would grow to more than $900,000 and their side fund to more than $200,000, even after paying for college.

It's a thin line, however, between success in the retirement game and failure. Were the Imperatis to spend the cash savings from their early loan payments instead of investing it, their nest egg would probably run out while they were still in their 70s.

Stephen and Cecilia Strauss THE ALL-AMERICANS

GOAL: Retire soon--but not before a career switch or two

CHALLENGES: Though they have plenty of savings after many diligent years, they need to diversify their holdings. He's got a lot of company stock; nearly all the rest is in U.S. blue chips.

Stephen and Cecilia Strauss have had it with having it all. He's 45, a product engineer at 3M in St. Paul, who, despite working occasional weekends and 24-hour shifts, still finds time to coach his son's soccer team and do his share of the cooking at home. His specialties include weird dishes like "blue food," a red-cabbage and brown-sugar concoction. ("When you boil the cabbage, the water turns blue," explains the engineer.) She's 42 and a former Peace Corps volunteer who's about to take a leave of absence from her job as a hydrologist for the state of Minnesota "to confront our latchkey-kid worries," as Steve puts it. That will cut their annual income from the current $131,000 to $82,000.

Likewise, Steve, who's been at 3M for 19 years, would like to try out a new career before he retires, perhaps teaching math and science to local school kids. And further complicating the picture: The couple not only want to send their three children, now ages 10, 5, and 3, to college someday, but are aiming to contribute 10% of their pretax income to charity every year.

Can they do all that and still retire with enough time left to enjoy their golden years? The memory of Steve's father looms large: A lifelong mechanical engineer for Honeywell, he died of a heart attack on a business trip, just three months before he was supposed to retire. He was 62.

The team of financial planners at Bugen Stuart Korn & Cordaro in Chatham, N.J., has welcome news. With $357,000 in pretax retirement assets, another $111,000 in taxable accounts, and $4,800 earmarked for college savings to date, the Strausses should be able to achieve their goals, if they continue to live modestly. Among their assumptions:

--Steve attends graduate school part-time during his last two years at 3M, at a cost of $12,600. During that time he continues to contribute 10% of his salary to the company 401(k). (3M matches at least 35% of the first 6% of contributions.) He graduates at 50, earns $35,000 a year teaching school, and retires at age 62.

--Meanwhile, Ceil returns to her job in two years at her old salary level and contributes 5% to her retirement plan. She also retires at 62, or three years after Steve.

As for college savings, the experts at Bugen recommend that the Strausses start contributing to one of the state Section 529 plans (see above), where earnings grow tax-deferred until they are tapped to pay qualified higher-education expenses, at which point they are taxed at the child's (presumably) low rate. Minnesota will introduce such a plan later this summer, to be managed by TIAA-CREF. Based on historical returns and other assumptions, the Strausses will need to invest about $6,900 a year for their oldest child, $4,900 for the middle child, and $4,300 for the youngest child to cover annual tuition of $16,100 in today's dollars. That takes into account the $4,800 they've already saved in education IRAs and mutual funds, but not the $22,400 in EE Savings Bonds they own. The Bugen team says the bonds should be used for college only in the unlikely event that the income would be tax-free. And that means satisfying a whole slew of conditions, explains Daniel Pederson, author of Savings Bonds: When to Hold, When to Fold, and Everything In-Between. Among the biggest: The Strausses' income for the year during which the bonds are cashed must fall within a certain range, currently $79,650 to $109,650, adjusted annually. If the bonds end up being taxable, they should be put toward retirement, to defer the tax hit as long as possible.

Key to the entire plan is the family's cost of living. If their base annual expenses (excluding child care and home-mortgage payments) remain at their current low level ($35,000 in today's dollars), the Strausses will almost certainly have enough money to live on until age 100, according to Bugen's Jennifer Papadopolo. That is true whether they bet 80% of their investment assets on a diversified portfolio of equities (with the balance in bonds) or just 60%. Those estimates include the private pensions Steve and Ceil will receive, but ignore their Social Security checks. If their base expenses rise to $55,000, however, there is a good chance that they'll have to dip into their retirement stash before age 59 1/2 and that their money will run out while they're still in their 70s. Early-withdrawal penalties could be avoided with some fancy footwork, but the valuable opportunity for further tax-deferred compounding of the earnings would be lost.

Currently the Strausses invest 79% of their liquid assets in equities, but they are taking more risk than they should. One reason: More than 70% of their money is in U.S. large-cap stocks. Papadopolo says they should reallocate some of the funds in their retirement plans to U.S. small-cap, international small-cap, and emerging-market and real estate investments. These high-growth, tax-inefficient investments are best held in tax-sheltered accounts, while the large-cap stocks and low-growth bonds are more suitable for taxable accounts. While Ceil is on leave, short-term taxable bonds (with a maximum maturity of five years) will probably make sense. But when she returns to work, munis may be more attractive on an after-tax basis.

In their taxable portfolio of 14 individual stocks ("fun money," they call it), the Strausses bet big on technology (70%) and biotech (20%) stocks. They should increase the number of stocks to 20 and diversify across all industries, says Papadopolo. In the process, stocks with losses should be sold to lock in the tax deductions; stocks with large gains should be donated, which will fulfill their goal for charitable contributions. As long as they've held the stock for more than 12 months, they'd get a tax deduction for the full value of the shares, not just what they paid for them (the cost basis). For example, if they bought a stock for $2,000 five years ago and today it is worth $10,000, they could give that stock to charity and get a deduction for $10,000. Were they to sell the stock first and donate the proceeds, they'd end up with just $8,500 for the charity after paying tax on the capital gains.

Another source of charitable contributions is the 3M stock Steve buys at a 15% discount through the company's employee stock-purchase plan, says Stephen Corrick, a partner in the Washington, D.C., office of Big Five accounting firm Arthur Andersen. Steve devotes 3% of his pay to such purchases. As long as he holds the stock for more than one year from the date of purchase, he'll get a full charitable tax deduction for the market value of the shares. This strategy has the added benefit of reducing Steve's exposure to 3M stock. Besides the stock he buys at a discount, he has 3M stock options, currently underwater. Plus, a full 22% of his 401(k) is in 3M shares (the company matches his contributions in stock), which he can't diversify out of until he's 55. And that's long after he hopes to have diversified himself right out of the company.

REPORTER ASSOCIATE Laura Vanderkam

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