It's easy to fake financial experience. But as you're holding court at the water cooler about your investing conquests, remember this: You're not the only one spinning tall tales.

Statistically speaking, there's a good chance that a few of your peers are savings virgins, too.

Just take a look at America's behind-closed-doors money habits: The amount of after-tax income we save has been free-falling for years, from 11% in 1984 to zip (yes, nothing) in 2005. More than 40% of workers aren't saving at all for their retirement. And 30% of baby boomers (the first of whom turned 60 last year) have a net worth of less than $50,000.

What's the holdup?
In the popular movie The 40-Year-Old Virgin, Andy Stitzer (played by Steve Carell) is a hapless innocent who has never, um, you know, done it. How did Andy wind up being a 40-year-old virgin? Like a lot of people, he figured the window of opportunity had passed. So he simply gave up.

Based on box-office results, a 40-year-old virgin is good comedy. A 40-year-old savings virgin ... well, not so much.

You may be older and grayer (though you can still pull off the mid-rise/boot-cut jeans look in our eyes), but that doesn't mean it's "game over" for your financial future.

Trust us, the moment has not passed.

Late bloomer or bust
In love and money, setbacks are standard fare. Perhaps you've already had a few financial false starts. Every day I look at Urban Outfitters stock with the sad eyes of regret. I had commitment issues back then and wanted to play the field with a no-brainer, low-cost index tracker like the iSharesS&P 500, which dings you just 0.10% in expenses. Yeah, the S&P-tracker gave me hefty exposure to a nice blend of large-cap value (low P/E, dividend-paying steady eddies like Wachovia (NYSE:WB) and Pfizer (NYSE:PFE)) and large-cap growth (Google (NASDAQ:GOOG) and its 32.5% five-year projected growth rate make up a big stake). Not to mention, the ETF instantly spreads out my risk.

But I can't help dwelling on my missed opportunity: Urban Outfitters has returned 635% to shareholders over the past five years, while the S&P 500, by comparison, has returned a measly 36%. Woulda. Coulda. Shoulda.

We all have pangs of regret about the ones that got away. Motley Fool co-founder David Gardner's is Yahoo!. His brother Tom's is Starbucks. Other Fool analysts tear up when anyone mentions Coach, Cisco, and Genentech. (Here's how to spot the early signs of winning stocks.)

Don't let past performance anxieties stop you in your tracks like they did Andy. Inertia is an investor's worst enemy.

Sooner is better
Take the classic example of people saving for retirement. Trish, David, Jay, and Cal each invest $5,000 a year for 10 years. The only difference is the age at which they took the plunge. What follows is the hypothetical return for each:


Starting Age

Amount by Age 65













*Assumes 11% annual growth and does not account for taxes.

Even though they invested the same amount of money ($50,000), the end result at retirement age is drastically different. Trish began when she was 25 years old and stopped at age 35. Her retirement nest egg dwarfs the later bloomers'.

Even delaying one year can make a big difference. Consider another example: A 40-year-old begins contributing $3,000 annually to a Roth IRA and continues to do so until he retires from his job at an electronics store at age 65. Assuming 9% annual growth, he'll have $254,102. Now, let's assume that instead of making that first investment at age 40, he spends a year looking for the best brokerage account, hemming and hawing about which mutual fund to pick, so he doesn't make his first investment until he's 41. How much will he have at retirement?

By age 65, he'll have just $230,369 -- a $23,733 difference thanks to his late start.

Gettin' down to business
Anne Scheiber was a 38-year-old IRS auditor when she gave her life savings to her brother, a young stockbroker on Wall Street, to invest. What happened next follows a Hollywood story arc to the letter ...

He lost it all.

Our real-life heroine didn't hole up and begin collecting Beanie Babies, though. Instead, she relied on her own pluck, saved $5,000, studied investing, and made her second entry into the stock market at the not-so-sprightly age of 50. When she died in 1995 (at the age of 101), she had a $20 million nest egg.

Let's say the fictional Andy had a chance meeting with Anne. What advice would she have given the inexperienced charge? Her recommendations (which we'll wrap around our increasingly strained savings-virgin metaphor so we can justify the headline) might have gone something like this:

Lean on your buddies: You don't have to go it alone. In fact, investing is one life event where your boss' input is welcome. A tax-advantaged retirement account -- such as a 401(k), 403(b), 457, or other employer-sponsored plan -- takes some of the pain out of taking home a smaller paycheck so you can invest for the future. Every dollar you contribute reduces your taxes. So if you're in the 25% tax bracket, for example, a dollar deposited in your retirement plan cuts your tax bill by $0.25. Put another way, you have to reduce your spending by only $0.75 to save a buck.

Let others chip in: If your employer matches your contributions, what a catch! That's like a date who picks up part of the check at the end of the meal. To add $1,000 a month to your account, you may have to contribute only $500 to $700 (depending on the matching formula) because your employer makes up the difference.

Go for a financial chest waxing: Andy endures some torturous grooming to prep for his re-entry into the dating scene. The financial equivalent to his chest waxing is a person's first look at their balance sheet -- what you own and what you owe. As painful as it might be, you can't afford to skip this step. It'll show you what you might need to change (budget-wise) today to improve your future financial good looks. Anyway, they say that hair grows back slower after it's waxed ...

Clean house: Andy goes through his apartment before his date comes by to get rid of all the embarrassing stuff. Similarly, a financial housecleaning can work wonders for your bottom line. (And, no, shoving it all in the closet doesn't count.) That chest waxing may expose some troublesome moles -- high credit card debt, beyond-your-means expenses (a third car or Supreme Cable Package, perhaps). In the movie, Andy's new girlfriend helps him turn his collection of action figures and comic books into booty. By hawking his stuff, he comes up with a $100,000 jump-start on his nest egg.

Pick your partners carefully: It might be tempting to go for a slam-dunk right out of the gate. But commitment counts. Retirement saving is for the long haul: You want to be able to proudly face your portfolio every morning (and brag about it to your mother). Be wary of get-rich-quick schemes, sexy high-flying stocks, high-fee mutual funds (e.g., those that charge a sales load), and the urge to trade frequently (triggering taxes and subpar investment results). If you seek the input of a pro, first have coffee (and review his or her recommendations) and then decide if the financial planner is worthy of a second date.

Play the market forever: Postponing retirement may be a smart move for savings virgins and experienced investors alike. Those who work a few extra years can improve their Social Security benefit. (The calculators in the Tools section of our Rule Your Retirement site -- click here for a free 30-day blind date -- can help you play out a few scenarios.) Staying on the job market is not just a financial issue, either. For many retirees, life after work ain't all it's cracked up to be. A Putnam Investments study found that the majority of people (68%) who returned to the job after retirement did so because they wanted to.

Performance matters
The habit of saving -- no matter when you start -- is the first big step for late starters. To ease into investing, we often recommend starting with an index mutual fund, which tracks the overall market's ups and downs.

Perfecting your game is what comes next -- supercharging your savings, pinpointing exactly what it'll take to retire at your target date, making what you have last a lifetime through asset allocation and location, and picking investments that will provide lasting return. That's what Robert Brokamp, pack leader, does each month in the Rule Your Retirement newsletter. Come check it out and the first round's on us. You'll get access to all the back issues, as well as the service's retirement-planning tools and moderated discussion boards.

The first step for late savers is scary. But once you finally take the plunge -- like Andy did in his, um, situation -- you'll realize that it's a lot less scary and loads more rewarding than you dreamed.

More tips for late bloomers:

This article was originally published Jan. 24, 2006. It has been updated.

Dayana Yochim is the advisor for Motley Fool Green Light, the Fool's personal finance service. She owns none of the companies mentioned in this article, but a few of them make her swoon. Pfizer is an Inside Value choice. Starbucks and Yahoo! are Stock Advisor picks. The Fool's disclosure policy is like a tall drink of water. For lawyers.