Just a few short years ago, retirement portfolios were growing great guns. Once the dot-bomb blast hit and the stock market followed, many people were left devastated, crippled or, at the very least, stung by the change.

During the times of 20 percent returns on our investments we bought big—big houses, big cars, big toys. What we did was stretch well beyond our means. But with those big returns on our investments, who needed to worry? We could always count on our portfolio to save the day or to provide an influx of cash.

But what we have found is what great thinkers and philosophers from the very beginning of civilization have warned us against. Our consumerism will come back to bite us. (See sidebar, "Wisdom through the ages.")

"This economy has been devastating to people in their 50s and 60s," says Brad Whatley, director of tax at the Leading Edge accounting firm PKF Texas in Houston.

"With their investment portfolios cut in third or in half, they realized they will have to work another 10 years. Maybe some were saying a few years ago that they would work five to 10 more years, knowing they could retire tomorrow. That's no longer the case," he says.