Your Retirement Plans Granted, retirement may not be uppermost in your mind. But holding off on saving because retirement is still a long way off is more expensive than you may think. Because money you invest at age 25 has much longer to build up in your plan, it will be much more at retirement than the money you start investing at 40.
Most companies have two types of retirement plans.
Then it pays you either a lump sum or a lifetime of monthly checks. A defined-contribution plan requires you to contribute to your own retirement. Both types of pensions adhere to a concept known as vesting, the process by which your employer's contributions become yours. Traditional pensions are designed to reward long-term employees, so you typically have to hang around at least five years before you're entitled to a penny. Be sure you understand how your company's vesting schedule works so that you don't unknowingly quit two months before you fully vest.