Many Americans want to start saving for their retirement plan as soon as possible. However, that doesn’t always happen — life circumstances make it necessary to make withdrawals and put off financial planning until later in life. For instance, you may decide to push retirement investing to when you are 50 years old.
That isn’t a bad idea because you still have time to save if you have a good investment strategy. Also, you will have given yourself time to invest enough in businesses and profitable assets like mutual funds, ETFs, and more. Therefore, you should never think it is too late to start and accomplish your retirement income goals.
Your personal finance journey will be different from those that started earlier. You will have a shorter time to reach your retirement savings goal and little to no margin for error. The positive is that your financial goals are still achievable, and this blog post has the best tips to help you get started.
Ways To Save for Retirement at 50
Now you have a background understanding of what it means to save for retirement goals at 50. This section will get deeper into the subject by discussing how to save for retirement at 50. It will discuss the various ways you can use to do it and reach your goal effortlessly.
Here’s what you should do to build your retirement savings at 50.
1. Leverage Your Traditional IRA or Roth 401(k)
You should start making the most of your IRA or 401(k) if saving for retirement. At 50, you are allowed to make catch-up contributions to push you closer to your goal. All you need to ensure success is ensuring you increase your contribution by contributing aggressively. However, bear in mind that some funds have yearly contribution limits. However, you can always add more savings to your individual retirement account.
The best way to do this is to speak to experts about contributing to an IRA or 401(k). Your company has human resources people that can help you get started with a 401(k) plan. But that depends on if the company you work with offers a 401(k) plan or other benefits that your
Also, you can increase your contribution by taking advantage of a company match. Sometimes, n employer matches these tax-free employee contributions to help their workforce contribute to their retirement funds. If there’s no such plan, you can ask your bank to open a Roth IRA for you.
2. Add a Fun Part-Time Job
Another way to do it is to increase your income in the short term. The amount you earn in your full-time job may not be enough to foot your bills and be a contribution to your retirement. Thus, you can find a part-time job to ensure you increase your savings rate in your retirement fund.
You can consider various investments and assets to increase your income. For instance, you can invest in the stock market or buy gold to store value. Also, you can find something fun to do since that will help you generate more money to contribute to your retirement fund.
Having a part-time job will make it easy to increase your income. In the end, it will be easier for you to ensure you build your retirement fund. Finding a fun job will help you ensure there’s no going back in increasing your income.
3. Eliminate Debt
No matter how high your gross income is, credit card debt and other debts can affect your ability to save for retirement. At 50 years old, you will find it difficult to save money if you have debts. Thus, it would be best to start by clearing your debt to ensure you save as much as you can when you start contributing to your retirement accounts.
Also, you can start thinking if your credit card is very necessary. Servicing credit card debt can be a headache, so it will be better if you can do without it. You can consider alternative ways of paying your bills without using your credit card.
Also, avoid taking on more debt than you cannot service fully before retiring. Otherwise, you may opt to use your retirement savings to service debts taken late in your career. This will, in the end, make it easy for you to reach your desired gold.
4. Invest Smartly
As any financial advisor will tell you, investing is one of the best ways to increase your income. And the more income you have, the higher amount you can save for retirement. However, you need to ensure you make informed investment decisions. Smart investments will bring you good returns — sometimes even compound interest — and help protect value.
If you haven’t invested before, you may not be sure about the best investments. One of the best investments you can consider is gold. You can invest in physical gold like the bullion bars sold by dealers like Acre. Also, you can think about buying shares in a company that trades stocks.
This will help you save money that you can use to build yourself. Also, it will save the value that you can liquidate later and fund your lifestyle after retirement. You may not even have to spend money from your retirement fund as soon as you exit employment.
5. Fund a Health Savings Account
Your health might begin to deteriorate as you approach the sunset years of your life. Medical bills become the biggest expense you incur when this time comes. Thus, it is vital to have a plan on how you will foot your medical bills without affecting your retirement account.
The best way to do it is to have a health savings account. Funding this account will leave you with enough money to put into your retirement fund. You can speak to your employer about your health savings account. They will help you get started and increase your monthly benefits.
You can think about having a private health fund if your employer doesn’t offer it. Various health plans are out there to help you pay your medical bills after retirement. Failing to have one at 50 years old will make it difficult to get the desired results.
6. Pay Yourself First
Many people forget how important it is to pay themselves first. Not many people understand what the phrase pay yourself first means. According to Investopedia, pay yourself first means sending money into your savings accounts before paying your utility bills or any other expenses.
This technique makes it easy to save and even generate investment capital. It would help if you thought about implementing it to ensure your retirement savings plan succeeds. With this strategy, you can still save even if you have a credit card or any other debts to pay.
Consider increasing the amount you pay yourself as soon as you pay all your debts. That will make it easier for you to build your retirement accounts. Also, paying yourself first helps you become financially disciplined, making it easier to become financially stable.
7. Automate Your Savings
Another strategy that works is using software to save money. Many people forget to send money into their retirement accounts as soon as they get paid. This leads to the accumulation of the due amounts. In the end, it makes it difficult to pay the whole sum at once.
The best way to do it is to ensure that you pay every end of the month. That way, you won’t lag and have a lot of arrears to clear. So, it would be best if you thought about automating your savings to do this effectively. This means you’ll fund your retirement account automatically.
In the end, you will easily reach your retirement savings goals. Besides, it will help you remain faithful to the cause for the remaining working years. By the time you retire, you will have to build a fund for your retirement. Thus, it would help if you considered starting to automate all your savings.
There are various online applications that you can use to do that. Apps like Digit, Qapital, Acorns, and Stash are increasingly popular today. You can take your time to find the best app for your needs. Then, you will easily stay up-to-date with your financial obligations.
Conclusion
As mentioned before, saving for retirement at age 50 isn’t easy. On the positive side, it is achievable, so there’s no reason to give up on it. This article has shared the best tips to help you get started. You now know how to save for your retirement at age 50 or beyond.
Key takeaways include downsizing by moving to a retirement community. If you live in the city, such a move will make it easy to reduce your monthly bills and save more. You can also start contributing to your IRA or a 401(k) to increase your retirement savings.
Also, another way to do this effortlessly is by having a permanent life insurance policy. Also, some people consider delaying their social security benefits until their full retirement age. These tips can help you reach your retirement savings goal, so start implementing them.
As said before, gold is one of the best investments you can explore. It can help you save money and also multiply it. Start by deciding what type of investment gold will best fit your needs. You can contact us if you want to consider gold bars. We will guide you to start and grow your investment.
Sources:
Average Retirement Savings in the US: $65,000 | The Motley Fool