Retirement Tips for Late Starters

The longer you put off saving for retirement, the less time your assets have to grow. But it is never too late to start. In this article, learn 5 retirement tips for late starters.

Speaking With a Financial Advisor

You should not try and go alone. If you are already behind, you need a financial advisor’s help even more. They can guide you through your different options and help you come up with a plan. It is also helpful to find a financial advisor that also provides investment services.

Utilize Catch Up Contributions

When you are 50 or over you have the ability to save more for retirement with catch-up contributions. You can save an additional $1,000 annually for Traditional or Roth IRAs. With a 401k, 403b, or 456b you can utilize an additional $6,000 in contribution. SIMPLE Plans allow an extra $2,500 a year. Whereas SEP IRAs do not allow catch up contributions.

Decrease in Expenses

Decreasing your expenses can help you to free up money that you can save for your retirement. Shop for cheaper insurance and eliminate unused subscriptions. You may even consider downsizing or moving to an area with a lower cost of living. Cutting expenses also helps your nest egg to last longer.

Eliminate Debt

As you plan for retirement, you should only carry a credit card balance in the case of an emergency. Start paying off debt and use the money you free up from making payments towards your retirement savings. Just be sure to monitor your spending, a few careless purchases here and there and you wind up back at square one. If you have a car payment, consider selling it and replacing it with a used car without a payment.

Be Creative

Do you have other opportunities you can use to pad your income? For example: do you have a spare room you can rent? Do you have unused items around the home you can sell? Do you have hobbies that you could utilize to make a little money? Coming up with extra money and cutting spending makes for an increase in your retirement account.

Bottom Line

Saving for retirement can begin at any age and any financial situation. All it takes is strategy, focus, and dedication. Hopefully these 5 retirement tips for late starters prove useful to you.

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