Nothing saved for retirement? What next?
If you are in your late 40s, you may be concerned about your financial planning for your golden years. If you have little or nothing saved for retirement and have hit this milestone, it is not unusual. Many Americans have waited until they reach a more mature age to really get going on their retirement plan. However, now is the time to act.
A recent study from the mortgage information website, Anytime Estimate, found that around 25 percent of boomers said they didn’t start saving for retirement until they hit 50 years of age. A new survey from the Transamerica Center for Retirement Studies estimated the median retirement savings of boomers is $202,000. If you start now and invest wisely, you should be able to save a significant sum by the time you hit retirement age.
Here are 3 ways to save for retirement
Educate yourself on investments
“Finding the right investment vehicle for you is key to building a solid financial future for your retirement. Jumping into risky investments is not a good plan at all,” says David Beckerman senior vice president of David Lerner Associates, “Find out if your employer offers a 401(k) plan, or perhaps an IRA is a better fit for you.”
Once you turn 50, you can start making yearly catch-up contributions to your investments. If you start as soon as possible, you will start building a good base amount. You’re allowed to contribute up to $7,500 to your 401(k) and up to $1,000 in an IRA in 2023.
Get a side hustle
45 percent of Americans have a side hustle. If you aren’t doing this already and you need to save money for your retirement, it is an excellent time to find one. Ridesharing is currently the #1 side hustle. This includes jobs like driving for Uber or Lyft. The average side hustle brings in an average of $483 a month.
Pay down or pay off your debts
The less debt you have the more money you’ll be able to save. And if you aren’t paying interest off on a loan, you have more money to put to work for your retirement. If you owe money on credit cards, try to pay off the debt as quickly as possible.
Some debts, like student loans and mortgages, are larger. Other big-ticket items like vehicles also usually have debt attached to them. Paying down, or ultimately paying off your debts is the best way to make sure that you have more disposable income and a more secure financial future.
Once you have reached an age where you are worrying about retirement it is most definitely time to think about saving. If you are in your late 40s, it is not too late and you should be able to build wealth quickly.
IMPORTANT DISCLOSURES
Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.
To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law.
Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances.