BOSTON (CBS) – The reality is that you are responsible for your own retirement savings. Fewer employers are offering pensions to employees.

Waiting to start to save until you are 40 is a big financial mistake. The key years for saving have passed you by.

If you start at forty and plan to retire at age 67 you have 27 years of savings and investing. But if you start at age twenty you will have 47 years.

The longer you wait to start saving for retirement the more money you will need to save.

If you want $1 million in your retirement nest egg, and I used an 8% return which is realistic, and you start at age 20 you will need to come up with $160 a month for your retirement account. That will amount to about $94,000 saved over 47 years.

If you wait until age 40 to start you will need to invest $880 a month, that’s $284,000 or 3 times the amount if you had started earlier.

At 40 you could have kids needing braces, college tuition, perhaps a car. Then there is really no money left over for retirement savings.

I have included a chart to illustrate retirement savings at various times in your working career on our website.

You are never too young to start thinking about saving for retirement. A kid in high school with her first job should be introduced to retirement planning by her parents.

I do believe most young workers can become millionaires if they are disciplined about saving.

A 16-year-old with a summer job earning minimum wage could conceivably earn $3,000 this summer. So what can she do for retirement planning?

Open a Roth IRA. She can contribute up to $5,500 to an IRA. If she is disciplined about this and contributes every year until she reaches age 67 she could very easily have over $1 million in her account.

One more thing: I would suggest if mom and dad can afford it to help the kids save for retirement by offering to match them dollar for dollar in savings. Gift the kids the money for spending and have them use their earnings for the IRA.

Assumptions: Future value $1,000,000 Retirement age 67 Annual return (%) 8 One Monthly Yearly Age Time Investment Investment ——— ———- ———- ———- 20 $26,859 $161 $2,208 25 39,464 243 3,287 30 57,986 368 4,924 35 85,200 564 7,451 40 125,187 876 11,448 45 183,941 1,395 18,032 50 270,269 2,316 29,629 55 397,114 4,158 52,695 60 583,490 8,920 112,072 65 857,339

You can hear Dee Lee’s expert financial advice on WBZ NewsRadio 1030 each weekday at 1:55 p.m., 3:55 p.m., and 7:55 p.m.

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