Even with all of the media promoting retirement planning, some of us just don’t plan for our golden years as we should, so in “How to Improve Your Retirement Income if You Haven’t Saved,” The New York Times offers advice to people who are close to retirement with little saved.
It is important not to just throw your hands up and figure it is too late. It is very easy to give up since retirement planning can seem daunting, especially when you see retirement looming on the horizon. Avoid the temptation to just ‘wing it.’ If you are nearing retirement but not actually retired, you still have time to save and you can take advantage on the higher limits on tax-differed saving accounts for people who are over 50:
“Someone who starts saving 30 percent of a $100,000 salary at age 51 could potentially have over $1 million by age 65.”
And while you may be looking forward to retiring, you may need to work longer and wait to start Social Security. You may not be thrilled at this prospect but if your health allows you to keep working and you don’t have much saved, you should not rush to leave the workforce. It would be better to keep working now than to have to face a lack of resources later when you may not be able to work.
One tip offered for those who are approaching retirement age but still have children at home is to record how much of your budget goes towards childrearing. When your children leave the nest, you can dedicate the money you would have spent on your children for retirement savings.
As The New York Times observes, “Retirement planning models often rely on rules of thumb that don’t always apply in individual situations.” This is why you need to work with a Fee-Only financial planner to get advice specifically tailored to your situation.