Remember compound-interest lessons from grade school? Your savings grow exponentially over time because your interest also earns interest. In a 401(k), the numbers are even more startling, because your company usually kicks in a contribution. If you start saving $4,000 a year when you're 25 and your company gives you a 50 percent match, by the time you're 65 you'll have $1.7 million in your 401(k) (assuming an 8 percent average annual return). And you'll have anted up only $160,000 of your own money. Wait until you're 55 to start saving and you'll have just $94,000.