You don't have to be a passionate investor to have retirement planning on your radar. It's part of "adulting," getting your finances in order before you set off on your golden years.

Most people are familiar with employer-sponsored plans like a 401(k), but less than one in five working Americans uses this highly effective and complementary retirement savings option.

Here is what you need to know.

The Roth IRA: The yin to the 401(k)'s yang

First, everyone should take advantage of their 401(k) or similar retirement plan if their employer offers it. Most companies offer an employer match for contributions to incentivize people to save for retirement. For example, suppose you make $100,000, and your employer offers up to a 4% match. Your $4,000 contribution could be matched by an additional $4,000 by your employer. That's $8,000 going to your retirement on only $4,000 out of your salary. It's free money, which makes a 401(k) at least worth investing in for the match.

But after that match, investors might look at opening a Roth IRA. An individual retirement account lets working people save for retirement outside their employer-sponsored plans. It's the polar opposite of a 401(k), because instead of putting pre-tax money in, you contribute take-home money instead.

Drawing of charts labeled Retirement Plan.

Image source: Getty Images.

The beauty of a Roth IRA is that your already taxed contributions grow, and you don't pay taxes on the gains when you withdraw them in retirement. Imagine your Roth IRA is worth $10,000 at age 25 and grows to $100,000 by retirement. That $90,000 in gains isn't taxed as you withdraw it. That's a financial game-changer for retirees!

Follow the rules

Naturally, a sweet deal like the Roth IRA has rules to follow. For example, you cannot make more than $153,000 in taxable income if you're single, and married couples can't make more than $228,000. Higher earners can still contribute to a traditional IRA and even consider a backdoor Roth IRA to get around the income limits.

Additionally, you can only contribute up to a certain amount each year: $6,500 annually until you turn 50, plus an extra 1,000 for those older than 50 who are trying to shore up their savings before retirement.

Remember that retirement accounts such as a Roth IRA have rules to encourage people to save in good faith. There are potential penalties for early withdrawals, so invest money you know you won't need and follow all the rules of using Roth IRAs. That said, your contributions can be withdrawn at any time penalty-free -- it's the earnings that come with stricter rules. Don't be shy about talking to a professional if you're not confident in making a decision.

This is why you should act now

It would be best not to procrastinate working a Roth IRA into your retirement planning for two reasons. First is the general math of compounding. The more time you give your investments to grow, the larger your eventual nest egg should become. A 20-year-old will probably retire with more money and less effort than someone who waits until 45 to get started.

This is especially important for a Roth IRA because of the contribution limits and rules. You can't ignore a Roth IRA for years and then decide to dump tons of money in later to make up ground. Once your annual contribution window closes, it's gone forever. Someone regularly saving in a Roth IRA from an early age is stacking up years of contributions that can't be made up later.

Retirement planning is a personal process that's unique for everyone. However, the benefits of a Roth IRA make it a helpful hack that most people should at least consider.