It’s never too late to save for retirement
Waiting until age 50 or 60 to start saving for retirement is not ideal. It’s late — but not too late. Anything you do now can improve your future. Here are some tips.
KEEP WORKING. Every situation is unique, but generally you need to keep working as long as you are healthy. You may be tempted to hang it up on the first day you’re able to draw Social Security benefits, but do you really want to join the 10 million Ame r i c a n retirees who are currently struggling living on Social Security alone?
SAVE LIKE MAD. Let’s say you are 50 years old and you begin immediately by placing $2,000 in a Roth IRA or a taxdeferred retirement account, which is invested in stocks, where it earns 8 percent annually (historically that’s been the longterm return for investing in stocks). You add $2,000 each following year (about $40 a week). In doing so, you’ll have about $210,000 by the time you really need it at age 80. Or if you double that, adding $4,000 a year ($80 a week), you’ll have $418,000 in your account on your 80th birthday.
MAKE IT AUTOMATIC. Set up an automatic deposit with your bank or employer, where a set amount is deducted from your paycheck and sent directly to your savings or investment account.
DECREASE EXPENSES. For the next 30 days, keep a daily spending journal. Record every expenditure, no matter how small and no matter whether you wrote a check or paid with plastic. At the end of the month, divide your spending into categories like groceries, gasoline and utilities. Once you have everything in writing it will be easy to see where you can make significant cuts to free up the money you need for your savings.