Let's start with a couple of facts. First, according to the 2000 census, the median age of the typical U.S citizen is 35.3 years. Second, according to the Bureau of Labor Statistics, the median age at which the typical U.S. worker retires declined during the 1990s, falling to roughly 62 between 1995 and 2000.
Put those points together and what have we got? Approximately 27 years to prepare for retirement, on average.
Seems like such a long time
But it really isn't a long time -- at least not if you fail to avail yourself of what Einstein once purportedly called "the miracle of compound interest." To wit: If you plunk down $10,000 and it returns an annualized rate of 10% for 27 years, your initial investment will grow to more than $130,000 by the time you enter your golden years.
Wait, however, and your fortune could turn out to be misfortune. Ten years at 10% will lead to just $25,937; a five-year savings "plan" will result in just $16,105.
The upshot, then, is this: Time really is money.
Prepare now for the future
An initial 10 grand won't get the job done, of course; it'll take many years of ongoing intelligent investing to get you where you want to be.
You might, for instance, consider setting up Drips -- dividend reinvestment plans -- with companies like Coca-Cola
Alternatively, you might go shopping for high-quality companies whose shares are currently unloved. Just now, in fact, Dell
The Foolish bottom line
If you've weeks, months, or more than 27 years until retirement, the time to plan is now. If it's not a 2006 resolution, make it one. Put the miracle of compound interest to work for you.
And if you're looking for big-picture advice, try out our new Motley Fool GreenLight service. Your subscription includes our brand-new report "11 No-Brainer, Money Makers to Boost Your Fortune Right Now." GreenLight will help you figure out where you stand now, where you want to go, and what you need to do to get there.
Ready? OK. Click here to try it risk-free.
Shannon Zimmerman is co-advisor for GreenLight and lead analyst for Champion Funds. He doesn't own shares of any company mentioned in this article. Coca-Cola and Dell are Inside Value recommendations. Bank of America is an Income Investor recommendation. Dell, Electronic Arts, and Bed Bath & Beyond are Stock Advisor recommendations. The Fool'sdisclosure policy sponsored this message.