NEW BERLIN, Ill. (TheStreet) -- We've all been there: making decisions on the old retirement savings account. It doesn't matter if it is a Roth IRA, a 401(k) or a deferred compensation plan, there are many different decisions that we have to make.

It can be overwhelming and confusing, until you step back and realize there are actually only three primary decisions to make:

  • How much to contribute.
  • How to allocate between stocks, bonds and other choices.
  • Which funds to choose.

Once you realize this, it becomes much easier to start the decision-making process. But here's something about that process I'll wager you didn't realize -- one of those three decisions is by far more important to the overall success in your plans.

(There actually is a fourth factor: having a plan and the discipline to stick to it. That means developing goals, mapping out how, incrementally, you will achieve those goals, and then putting the plan into action -- sticking to it no matter what and monitoring your progress. I know, I know, you're saying to yourself, "What a shock, the planner guy is advocating that we have a financial plan." Touche. So I believe in what I do. I recommend that you develop a financial plan regardless of whether you hire a professional to do it or make a plan on your own. I sincerely believe it is the most important factor in determining success in reaching your lifelong goals.)

The most important decision you can make with regard to your saving activity is the first one in the list -- how much to contribute.

According to recent studies, this one factor makes a much greater difference in the outcome of a savings plan than the other two, even in the best of circumstances. By choosing to save as much as possible, we are laying the groundwork for the other items, allocation and fund choice, to optimize upon the greatest possible starting amounts.

The studies indicate that fund choice makes the largest difference in the later years of a plan (lowest-cost choices provide better returns in the long run), and that aggressive allocation makes a slight difference in the short term, all other things being equal.

The rule of thumb generally is that you should invest at least enough to get the maximum from your employer's match, assuming a match is available. Above and beyond that, it is important to ensure that you're salting away as much as you can, so compounding can occur on as large an amount as possible for as long as possible.

This doesn't mean you should not pay careful attention to allocation and fund choices; what the study indicates is that you can make a mistake here and there with allocation or fund choice and it won't sink the boat.

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Jim Blankenship, CFP, EA, principal of

Blankenship Financial Planning

, based in New Berlin, Ill., is a NAPFA-Registered financial adviser. He writes frequently on the topics of retirement plans, Social Security and tax matters at his blog

Getting Your Financial Ducks In A Row

.