Are you a recent college grad? Have you just landed your first real, career-oriented job?

You should already be thinking about retirement. Because if you plan a little and save a little, starting now, you’ll be able to retire as a millionaire.

Even if you aren’t a recent graduate, and you’re not sure your career is on track, you should still have a retirement plan and stick to it.

Forty years is a long time away and it’s too easy to put off savings. There are bills to deal with, college debt to pay, stuff to buy, vacations to take, a career to build.

Many young Americans between the ages of 18 and 33 have no personal savings, and according to surveys, half or more have nothing in the way of retirement savings. And they’re really missing out. If a 25-year old with $10,000 invested $320 a month at a 7% annual compound rate of return until they turned 65, they would wind up with $1 million.

So, get started. Here are the basics on how to save and invest for retirement — no matter how old you are.

Automatic enrollment

How much you save for retirement is never an easy question to answer, especially when you’re just starting out in the work world, and retirement — or least what we call retirement today — could be more than 40 years away. The old rule of thumb was that you should save at least 10% of your gross earned income. That’s a good place to start.

And starting, no matter whether it’s 6% or 10% or 15%, could your best money habit to form, said the panelists who participated in our Money For Life discussion.

You want to get in the habit of paying yourself first before doing anything else with your money, before your rent check, your car payment or your pizza or your other discretionary expenses.

Here’s the good news about how this can be easier than you think. Many employers today will automatically enroll you in the company’s retirement plan, said to Catey Hill, a personal finance reporter for MarketWatch.

Automatic enrollment is based on the notion that workers might not get in the habit of saving for retirement. So, back in 2006, the federal government put in place a law that lets employers automatically enroll workers enroll in a 401(k) or similar plan, and then defer a portion of the worker’s salary into what’s called a qualified default investment alternative or QDIA.

“It’s great because you can never touch the money,” said Hill. “They’re automatically taking that out of your paycheck. It’s great because if you could use it, you’d probably be at IKEA buying a new couch for your apartment or something, but you can’t.”

Another panelist agreed. “Studies have shown that when people have to choose to go in [to a savings plan], they don’t go in. And when you have to choose to opt out, you don’t opt out. So we know that it’s a way to trick people into actually saving for their own retirement,” said John Pelletier, the director of the Center for Financial Literacy at Champlain College. “It doesn’t increase financial literacy because you’re not really learning anything out of it, but you are saving money.”

How much your employer automatically defers from your paycheck will vary. Some employers automatically defer 3% while others defer more. The important thing to consider though, is whether your employer offers a matching program or not, and how much you need to defer (save) to receive the employer’s full match.

Matching programs vary from company to company, but employers will typically match 50% of the employee’s contributions for the first 6% of salary that an employee contributes. So if you’re making $50,000 and you defer 6% of your pay a year ($3,000), your employer will contribute an additional $1,500 (what some often call free money) into your account. That would make the total $4,500, or 9% of your pay.

“That’s like a pile of money on the sidewalk, right?” said Eleanor Blayney, a certified financial planner and consumer advocate for the Certified Financial Planner Board of Standards. “If you don’t sign up for that match you are walking over — you’re just stepping over the $1,500. That’s a big mistake.”

Pelletier asked where else an investor can get a 100% return the first day, or a 50% return the first day they invest? “You can’t. You can’t. So to us it’s a no-brainer.”

Saving 9% also gets you fairly close to benchmark rule-of-thumb of saving 10% of your salary each year. One note: If you’ve been automatically enrolled in your company’s retirement plan, you’ll likely have to ask your employee benefits department to increase the amount you are deferring from the percent you were automatically enrolled in at, to 6% of your pay or more.

And whatever you do, don’t opt out or dis-enroll from your employer’s retirement plan. “Let inertia keep you in (the plan),” Blayney said.

How to invest?

Saving is one thing, but investing the money you have earmarked for retirement is an different matter.

In some cases, your employer will automatically invest your money into a QDIA. And that QDIA is likely to be something called a target-date fund, or a TDF. A TDF is fund-of-funds that is designed to match your anticipated date of retirement. The TDF invests in a mix of stock and bond funds and gradually reduces the percent invested in stock funds the closer it gets to the “target date.” TDFs, unlike target-risk funds, tend to become less risky or volatile as it nears the target date in the fund’s name.

If you’re just starting out in the work world, your employer might automatically invest your money in fund that has the years “2055” or “2060” in its name.

The good thing about TDFs is that they provide inexperienced investors who have little in the way of financial capital in other types of investment or retirement accounts to have an asset allocation that matches their time horizon and instance diversification among a wide variety of stocks, bonds and cash.

Pelletier said the best investment option for folks just starting out would be the TDF. “Now it may not be perfect and we can nitpick at it, but pick a target fund, and you don’t have to worry about doing any of the research.”

If, on the other hand, you choose to invest your money on your own — by picking how much to invest among the many investment options in your 401(k) plan — realize this: Investing only in an S&P 500 SPX, -1.15% stock index fund may not be a sound investment plan; it doesn’t provide you with adequate diversification.

And don’t just put your money into the lowest-risk, least volatile investment. “What do most people do?” asked Pelletier. “They go into a money-market fund, which is the lowest-yielding, lowest-returning product and it’s lousy for you because you’re losing to inflation over a long period. So I strongly urge you to do the target fund that’s got the longest maturity out there and then just forget about it, keep adding to it. That’s my takeaway.”

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What’s more, the experts suggested that you avoid using the 1/n strategy when investing in your 401(k) plan.

That’s that the strategy where by you would invest equal amounts in all of the investment options in your 401(k). So, for instance, if you had 20 investment options you would invest 1/20th of your contribution in each of the options.

And this is how it might play out in reality: 1/20th of your money would go into a TDF, which already invests in a mix of funds, 1/20th might go into a growth fund (which you already own in your TDF) and 1/20th might go into a short-term bond fund (which you already own in your TDF) and so on.

So, what you get isn’t necessarily diversification, but a spaghetti against the wall.

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If you plan to invest on your own instead of using a TDF, do this: Determine your tolerance for risk, your time horizon, and your goals. By going through that process (many 401(k) plans, by the way, will help you do this) you’ll be able to determine your asset allocation: how much to invest in stocks, bonds, cash and nontraditional assets.

Part of this process requires that you invest in assets that aren’t correlated, said Pelletier. You’ll want to invest in such a way that when some assets are falling in value others are rising. By investing this way, you’ll improve what the experts refer to as your risk-adjusted performance.

“If you think about these different classes, they work together to lower the risk because they don’t work together,” said Pelletier. “And then if you think about each bucket within each class, they work together because they help to spread the volatility or the diversification. And we’re always talking about volatility, and volatility is risk. And so what we always talk about is risk and return.”

Pelletier noted that many investors like to focus just on returns and the hottest-performing funds. But that’s how investing works. “Everybody looks at return,” he said. “And you’re looking at last year’s numbers because the fund companies love to publish historical performance; and the hot winners last year generally are never going to be the hot winners in the next year — but that’s what everybody buys. So a diversified portfolio is putting all of this together into your basket.”

Which accounts?

When you’re just starting out in the work world and starting to save for retirement, what matters most is that you take advantage of the power of compounding that takes places in a tax-deferred or tax-advantaged account, Blayney said.

For instance, you’ll contribute pretax money into 401(k); it grows tax-free; and the distributions are ultimately taxed, typically years later when you retire, at ordinary income rates.

“So let’s just say you’re making $50,000 a year to begin with and you say, OK, I’m going to put in $2,000 a year,” said Blayney. “That comes right off the top. And then it’s the rest that you report, with some adjustments, for taxes. So those are pretax dollars. They are not taxed. They’re going to into the plan and that’s when they start their compounding because retirement’s a long way away. And so those dollars haven’t been diminished and they’re going to grow and they’re going to compound without being taxed as they compound…So it really is a powerhouse.”

But you might also consider saving and investing in a Roth IRA or Roth 401(k), if you can. You’ll contribute after-tax money, presumably while you’re in a lower tax rate; it grows tax-free; and then the distributions, when you take them, will be tax-free as well.

Many experts recommend opening various types of investment and retirement accounts so that years from now you’ll have the ability to withdraw money from those accounts in the most tax-efficient manner possible.

Blayney said diversifying your money across different types of accounts — known as account diversification — can get quite complicated. “You’ve got to think about when is the tax hitting this money and how is it growing,” she said.

Given that, she recommends that people just entering the workforce out to seek out advice and guidance from their employee benefit department, their parents, and a financial adviser to help sort through the choices.

The basic decision, however, can be boiled down to this: “What’s my tax rate now while I’m thinking about contributing, what will it be in the future?” Blayney asked. “And that’ll give you the answers to the best way: should I save on an after-tax basis, should I be saving on a pretax basis?”

To be sure, many young workers will be in a low income tax bracket early in their working years and in a higher tax bracket, as their salary grows, later in their working years and possibly into retirement. That would suggest that workers contribute first to a Roth IRA or Roth 401(k) first, before a pretax IRA or 401(k).

“For most people just starting out, you’re not going to pay much in federal taxes,” said Pelletier. “You’ll pay a lot more in Social Security taxes and in state taxes than you will in federal taxes. And in that case you’re probably better off with the Roth option and I think it’s worth emphasizing.”

According to Pelletier, the Roth is the better option because young workers are unlikely to benefit from the deduction that comes when contributing pretax to a 401(k). “The Roth is perfect because you’re not going to benefit from the deduction and all the compounding, either way, is tax neutral,” said Pelletier. “And then when you pull (the money) out you don’t have to pay any taxes on it. So if you’re in a low bracket the Roth works really well.”

It works especially well if you have a Roth 401(k) at work that also has an employer’s match. And if you don’t have a Roth 401(k) at work, Pelletier recommended establishing a Roth IRA where money is automatically deposited into the account from your checking account on a regular basis. “If you’re trying to save for retirement you might have to do it yourself,” he said.

Some advisers say it’s wise to first contribute enough to a traditional 401(k) to receive the employer’s full match and then save and invest as much as possible in a Roth 401(k) or Roth IRA after that.

Advisers also suggest that the decision to save and invest in a Roth 401(k) or Roth IRA requires that you examine the need for account diversification regardless of whether your tax rate will be higher or lower in the future. Having the option makes it possible to choose the best account from which to withdraw money years from now. But that won’t be possible if you don’t have a Roth or taxable investment account.

Another panelist, Robert Glovsky, a certified financial planner and vice chair of the Colony Group in Boston, said it’s also important to remember that many young workers will likely switch employers many times over the course of their working lives, and that they should avoid taking distributions from their 401(k)s when leaving their employers.

Instead, he and the other experts recommended rolling the money in those plans into an IRA, their new employer’s retirement plan, or leaving it with in their former’s employer’s plan. Doing so allows your money to continue growing tax-free; taking the money, by contrast, could create tax liabilities and penalties.

Don’t forget your emergency fund

As you get into the habit of saving and investing for retirement, the experts were also quick to note the need to have an emergency fund: between three and six months of living expenses (during good economic times and even more during bad times) set aside in a liquid account, a money-market fund for instance.

But they didn’t necessarily agree on whether that’s the first priority. “Because we have finite dollars we can’t do everything we want to do,” said Glovsky. “And so it’s really a question of prioritizing. And I do think an emergency fund is the first thing you should save for. And once you get that, then you want to start thinking about the retirement account. You want to think about buying shelter, a home somewhere. And so you’ve got goals that — I don’t want to say they clash — but they have to be prioritized and balanced. And it’s tricky. It’s tricky.”

Blayney suggested that those just starting out in the work world might first pay down their debt, then split their savings between the emergency fund and their retirement account, putting in enough to get the employer’s full match. “Like all financial planning, it very much depends on your own circumstances,” she said.

This of course gets to an age-old financial planning question.

Do you save for your various goals all at once, or one at a time — funding the short-term goals first and the longer-term goals later in life?

Blayney said the reasons why you need an emergency fund are many. One being this: If you lose your job, you won’t have to live off your credit cards. “So it’s a buffer to keep you from going backward with all of this,” she said. “And the match, of course, is to get you going forward. So there’s no single answer, such as ‘just do the emergency fund and then go to the match’ or whatever. Some people are happier if they’re putting a little bit toward every goal. You know they feel better about it. It just depends on the urgency of all this in your life.”

She recommends recent grads start by cleaning up any debt they have, managing their debt, their student loans and their credit wisely.

The experts also said one reason why you need an emergency fund is because you don’t want to move back in with your parents, or become a statistic.

“In this country about 60% of people don’t (have an emergency fund),” said Pelletier. “In Vermont, that number is 62% based on a survey that was done in 2012. You don’t want to be in that percentage. Maybe you will be for some time, but you don’t want to be forever because then you’re just a job loss or a medical issue away from catastrophe.” And you don’t want those catastrophes to force you to dip into your retirement savings, he said.

More from our Money For Life series:

Invest in yourself to maximize your return on (human) capital

Three secrets to financial success

From our archives, read Start with $10,000 and retire a millionaire.