Not long ago, I started advising a woman in her 60s who had not done any serious financial analysis of her situation for a long time, maybe not ever.  But she was thinking she might not be working full-time much longer, and she had some other ideas of things she wanted to do (hoping to get paid for some of it, but uncertain of the prospects).  She was willing to cut back, to simplify her life, but even so was unsure of whether she'd be OK or not.

This uncertainty is commonplace among us Boomers who are quickly approaching retirement.  Most of us have financial resources: some savings, maybe in a 401(k) or other plan, maybe some we have put aside on our own; often a home which, even if it's currently under water, will probaly gain in equity in the coming years; entitlement to Social Security benefits, which can be pretty substantial; maybe a pension, or two, from current or past employers; possibly even an inheritance yet to come our way.  And like my recent client, some of us have at least the possibility of continuing to have some earned income after we "retire."

The other side of the coin, though, is that many of us have fairly expensive lifestyles, mortgages that are not paid off (or rent that will go on forever), perhaps other debts, and the possibility of incurring high medical expenses at some point, including perhaps a long stay in assisted living or a nursing home.

How do these plusses and minuses balance out?  Unfortunately, it appears, most of us don't know, and what's more, really don't want to know.  We're afraid that, as Jack Nicholson's character put it in the movie A Few Good Men, we "can't handle the truth."  It might be too painful, demonstraing that we live too well, have not saved enough, and are in for a big and nasty surprise when we retire.  So some of us are just hoping for a miracle (lottery tickets, anyone?), or maybe even the opposite ("Who knows, I might not live that long!").

In this case, ignorance is not really bliss.  An awful lot of Baby Boomers I know have this gnawing, growing, underlying fear.  And the closer they get to retirement age, the closer to the surface this fear rises.

Knowledge is better for two big reasons.

First, if you are headed for financial trouble in retirement, the sooner you acknowledge that and react to it, the less painful it will be.  Instead of falling off a financial cliff when you retire, you can make smaller adjustments now that will prevent such an outcome.  The reason sooner is better than later is that if you cut back your expenses a bit before you retire, you not only get used to moderating your expenses, but you can put aside into savings whatever you don't spend between now and retirement, thereby giving yourself more financial leeway later on.  So you come out ahead on both ends.

The second reason that knowledge is better than ignorance is that you might find, as my recent client did, that you're in better shape than you thought.  You might find that that gnawing worry is not really necessary, and that you're either in a reasonably satisfactory situation, or that only small and palatable changes are necessary to get you there.

My best advice, therefore, is to set aside some time to dig into the facts about your own situation.  Yes it can be a bit time-consuming and complicated, but it's not the hardest thing in the world.  If the outcome is favorable, you'll be very glad you made the effort.  If it isn't, there are various strategies for coping even with rather bad financial situations, and figuring out at least the outlines of a plan will give you a justified sense of being back in control.  So even a bad outcome will probably make you feel better.

There are lots of statistics, but no reliable ones, on this matter.  But my own sense, based on a lot of reading in this field, and on my own experience, is that about half of the people in our age cohort are in very good or pretty good financial shape, and about half will need to make some significant adjustments.  And of those in the second half, the sooner they realize their situation and start doing something about it, even if it's only a little at first, the happier they will be now and the better off they will be in the future.

Chuck Yanikoski is a part-time retirement adviser who lives and works in Harvard. For more about him, or to contact him directly, visit www.ChuckYRetirement.com