Never too young to save for retirement

April 25, 2012 at 2:36 PM ET

Farnoosh Torabi

Some people think about saving for retirement in their twenties, others start contemplating rocking chair resources after they hit the big 40.

With a recent report that Social Security funds are dwindling, folks of all ages are wondering if they'll have enough to retire comfortably. 

What ever age or type of saver you are, the key is coming up with an action plan, advised personal finance expert Farnoosh Torabi, who was on hand Wednesday to answer readers' retirement money questions during our weekly live web chat.

A poll of readers who participated in the chat found only 11 percent are sure they'll have enough funds to enjoy those golden years; while 33 percent said they definitely won't have enough money, and 56 percent weren't sure.

How much should you be socking away? asked one 40-plus reader.

“Had you been consistently saving since your twenties, I'd say 10 percent would be enough,” maintained Torabi, author of “Psych Yourself Rich: Get the Mindset and Discipline You Need to Build Your Financial Life”, and host of "Financially Fit" on Yahoo. “But if you've just begun saving in your forties, you should be as aggressive as you can be by putting about 15 percent towards your employer's 401(k), or more, and opening up an IRA or two to supplement the 401(k).”

For the 20-something wondering how she should start and worried about paying hefty commissions, Torabi had this advice:

“I would 100 percent recommend doing two things: Invest in your company's 401(k). Contribute 10 percent or at least enough to benefit from the full match your company may provide. Second, open a Roth IRA. You can open one up at any brokerage - Fidelity, Vanguard, Charles Schwab. The cheapest way to open one is probably going to a local credit union or your existing bank and opening a retirement account there. I have one with ING Direct, as well. No brokerage fees!”

Here are some more highlights from the Q&A with Torabi:

Bobby asked:

“Hi, I'm 68 years old with no retirement or pension funds, just $20,000 I've saved up over the years in the bank. I just got fired from my job as a factory worker because my entire left side got paralyzed after a stroke and I have no education at all besides a high school diploma, so what should I do with my money to maintain myself? Should I invest it in stocks or gamble it away in Vegas, because they're both just as risky aren't they?”

Torabi’s advice:

“Vegas is beautiful this time of year, but I would encourage you to continue to save that $20,000 and -- are you collecting disability? Check out this site to learn how to get compensated:”

LaTonya asked:

“I am not sure if I am putting enough away for retirement. My husband and I both have jobs with pensions and health benefits at retirement (30 years). In addition to our pension contributions we have a Roth IRA that we contribute the max to each year. Is it safe to depend on our pension and not contribute more to private retirement accounts?”

Torabi’s advice:

“I never like to put all my eggs in one basket! And while you still have a pension (and that's so amazing!) I would try to diversify my savings -- you never know what could happen to those pensions or whether they'll be enough. It's always best to have a separate IRA to, again, diversify your savings and allow for multiple income streams in retirement.” 

For a full look at out web chat with Torabi go here: