Saving for Retirement

Saving for Retirement when your a Late Starter

If your saving for retirement and you go a late start then here are some things to remember:

• Get Going: I completely understand getting started late, but don't sit and cry about it get started now. Start saving today and make it your priority just after paying off your debt. If you haven't saved for your child's college tuition this would be the time to explain it to them that they will have to work in college. Don't feel guilty just tell them the truth they will live through it.


• No more house payment: If it is at all possible get your house payed off in full before you retire. Pay extra principal payments to get the sucker done. If your house payment is $2000.00/month and you can get it payed off then that is $2000.00/month less you will need in retirement.


• Wait for Social Security: Hold off as long as you can to start collecting Social Security, but don't go past 70. If you are a late saver then live off whatever you have managed to save until you get close to 70 then start using your Social Security to supply your income when you run out of your own savings.


• Don’t invest with your hair on fire:Don't go stock market crazy and invest in every hot stock. Be smart about what you are investing in. If you are too aggressive you could end up losing what little you have saved.


• Don’t invest while sitting on a block of ice: Do be too frugal with your investing. You need a little risk to get the large gains you need to make up ground.


• Use the tools the tax man gives us: Get some guidance to help you understand the various ways to invest. 401K, Roth IRA, Mutual Funds or whatever route you choose, the big thing here is to find ways to save on your taxes.


• Work a couple more years: Since you put off saving for twenty years go ahead and give 5 more years to the work force. During the last years you are working live off PB&J, beans and rice, and noodles. Save everything you can. You could save nearly $25000.00 in five years if you just quit eating lunch out and pack instead. If you managed to save $5000.00/year for 5 years and got 8% return you would have over $31,000.00 after the 5 years. If you would have started that 20 years ago you would have over $245,000.00.

Check out this calculator to see what you can do.