Is It Too Late to Start Saving for Retirement?

Jun 8, 2016

Is It Too Late to Start Saving for Retirement?

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There comes a point in everyone’s lives where they start thinking about retirement or someone else brings up the topic and panic ensues. You start thinking, “I’m not going to have any money;” “I will be a burden to everyone.” After all, retiring is very expensive, and as we all know, money goes fast. But have no fear! It is not too late to start making changes so that you may have some money for retirement.

Planning, Cutting, and Living on a Budget

A great place to start to planning for retirement is by making a list of all your expenses, down to each dollar (including that Starbucks trip). This will pave the way for cost cutting; do you really need to eat out every night? Would you truly die if you didn’t buy that handbag you desperately needed and couldn’t live without? Now we all know, sometimes we need to spoil ourselves, but not if the spending is consuming us. By budgeting your money and cutting out expenses that are not necessary, you can get yourself on a better track for saving for retirement.

You can minimize your lifestyle to a less materialized way of living. For instance, you can cut down on monthly costs by eliminating cable. This may sound like a ridiculous notion, but nowadays it would actually be more doable. With Netflix, Hulu, and other broadcasting devices, you can easily give up cable and watch your shows or movies on these devices. A Netflix subscription is only $9.99 per month and is available on any Internet device. As long as you keep your Internet plan, you can continue enjoying your binge-watching while not paying a higher cable bill.

Another way to save is by downsizing your home! Do you live in a place where you can fit a whole family, but you are the only one living there? Then perhaps you could move to a smaller home. You want to make as many changes as you can with your expenses so that you can stretch your savings further.

Take Advantage of Work Benefits

You may have heard of a 401k, IRA and pension plans when people discuss their retirement plans. These are great plans that help you save money for retirement: your company or business may offer these for you. Look into if your work offers these plans, because they are a big help. Here's a small explanation of what a 401k and IRA are. A 401k is offered by an employer as a savings plan for retirement. A portion of an employee’s paycheck is placed into the account before taxes and grows over time.

An IRA plan is a savings plan that is added to by the employee with their paycheck (after taxes) and has the potential to grow without being taxed. Employers who contribute a certain sum of money for retirement for the employee offer pension plans. Basically, each type of plan offers an employee money for retirement. It would be helpful to talk with your employer to learn more about these plans so you know your options. Another tip: anytime you may receive a bonus or raise put that straight into your retirement savings account. 

Investing your money can also be a great way to gain more money for your savings. By investing in bonds and stocks you can receive more money. Be aware of how you invest because there are many scams specifically targeting the older generations. So, be sure to meet with a consultant or agent to discuss your retirement options and make sure you read all of the fine print!

Delay, Delay, Delay!

Since you waited until later in life to save for retirement, delaying retirement would be a good option. That way you have more time to save; otherwise, you may not have enough money to retire. You should also hold off on receiving your Social Security payment because if you wait, then there will be more money to receive, but if you withdraw it too soon, you could be charged a fee for removing it before the proper retirement age. If you are still working, now would be a great time to pick up any extra hours, overtime, and whatever you can get.

When you are older and cannot work anymore, you will appreciate all of the extra time you put into work! If you have one job, but have time to take on another job, even just a part-time job, then go for it! Any extra money you can earn and place into your savings would be a great help. This would also be a great time to apply or start looking into long-term insurance. It is recommended to apply for long-term insurance as early as possible. You can still receive it later, but it is advised to be purchased as soon as possible.

So, just put away all of that stress and begin planning! It is not too late to start saving, but do not procrastinate! Retiring costs a lot of money, so the more you can plan and save, the better it will be for you. Cost cutting and budgeting may seem like a waste, but it really does help in the long run. By being careful with your money, checking out your options, and working as much as possible, you will have accumulated your retirement savings!

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