Today I want to demonstrate just how crucial starting early is in making such a plan work. Meet Alisa and Xena. Both women are 22 years old, recently graduated from college, and working for the same company. Xena's eyes glazed over. After all, she's only 22 and paying off all those student loans.
Retirement savings can wait.
But there you have it. Xena, however, wakes up and realizes she better get going if she plans to have anything but cat food in her pantry come retirement. The ladies reach their retirement party at age 65 and sit down to reminisce. Xena, convinced that her 37 years of saving will have blown away Alisa's meager six years' worth, brings up the topic of retirement plans and vacation homes. She gradually steers the conversation towards the value of their Roth IRAs so she can gloat a little.