Retirement planning: Start out strong

Problem With plans to start a family soon (and possibly a career in public service), the couple need to get their money growing. Makeover Open a Roth IRA to supplement their retirement savings, and invest 90 percent or more of their portfolio in a diversified mix of stocks. Payoff Since they're young enough to ride out short-term downturns, they can rely on an aggressive strategy in pursuit of long-term growth. Strategic pick: Vanguard Growth Index Because this low-cost fund invests in some of the bluest of blue-chip growth stocks (names like Cisco Systems, Procter & Gamble and Wal-Mart), a young couple like the Lewises can feel comfortable buying and holding it - no matter what - for the long run.

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• The Money 70
• Funds for the long run

Money Makeovers:

1. Twentysomething: Start out strong
2. A thirtysomething's search for financial security
3. Mid-career: Reduce retirement plan risk
4. The home stretch to retirement
5. Retired - and ready to play it safe

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(Money Magazine) -- When you're young, the most important thing you can do financially is get off to a good start. Jodi and David Lewis have certainly done that - at least when it comes to their jobs.

Jodi, a development director for a nonprofit, was the youngest person ever elected to the Piedmont, Okla. city council.

David is a regional manager for a staffing company, has written a book on leadership and was recently named one of the area's "Achievers under 40" to watch.

And though he lost a 2004 run for state representative, David says he'd like another try at politics someday.

But for this to happen, the Lewises have to shore up their finances. That's because a career in public service could cut David's income by more than half.

Meanwhile, like other couples their age, the Lewises are thinking about starting a family soon - and hope to retire young.

"We've got four or five different irons in the fire," says David. "It's going to take some financial freedom to make everything possible."

On paper the couple's finances appear to be on the fast track, at least relative to those of other workers their age.

Combined, these high achievers earn $135,000 a year. They own a $130,000 home, as well as a rental property valued at $100,000.

But like other twentysomethings, the Lewises have done their fair share of spending - especially since getting married in October 2006.

"We took three vacations, updated the wardrobe, did a home improvement project," David says.

This explains why they have only a modest $11,000 emergency fund. And they still owe $25,000 in school and car loans and $5,000 on their credit cards.

But David and Jodi say they're now ready to ratchet up their savings.

Their first investment goal - and the foundation of a safe financial plan - is to build up their emergency fund, says Tulsa financial planner Adam Leavitt.

He suggests using half their excess cash flow - the Lewises have $2,400 left over every month after paying their bills - to boost their rainy-day fund to more than $20,000.

The couple should also use David's bonus and outside income as an author to retire debt. Paying off high-interest credit cards is especially smart in an uncertain market, when it's unclear what you can expect from stocks.

To supplement her small retirement account, Jodi should also open a Roth IRA, contributing the $5,000 maximum for 2008, Leavitt says.

And he suggests opening a taxable investment account with money left over, which the couple have already done.

David and Jodi can also improve their investments. David owns a jumble of 17 funds in his $35,000 401(k). Leavitt suggests a simpler mix of seven, anchored by blue-chip choices like Vanguard Growth Index (VIGRX) and Vanguard Value Index (VIVAX).

And even though the Lewises know all too well the risks involved in a shaky market - after seeing a $5,000 investment Jodi made in Williams Communications at age 19 shrink to 87 cents, the couple need to stay aggressive.

Leavitt says 90 percent of their investments should be in equities, with the remaining 10 percent in bonds.

And within their stock portfolio, he recommends boosting international exposure from around 25 percent to 35 percent through low-cost options in David's 401(k) like DFA International Value I (DFIVX).

By ramping up their savings and investments, the couple should be able to start a family soon, pursue their career ambitions and even retire early. But the key is to get started quickly.

"Doing it now," Jodi acknowledges, "makes a world of difference."

Are you on track for an early retirement? Tell us why at millionaire@cnnmoney.com. Include your financial details and your family could be profiled in a future column of our Millionaire in the Making series.