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Tips for Planning for Retirement Late in the Game

June 22, 2021

Not everyone started their retirement planning early in their careers. And that’s okay. There are many reasons people have put off saving for retirement, but the good news is you can still start planning for your retirement years even if you are well into your working career.


Here are four retirement planning tips for you late starters.

1. Review Your Budget

Minimizing your expenses can free up more funds that you may put into savings. Take a hard look at your expenses and see what you can cut. Every little bit helps. Just think, if you save $30 every month for 20 years at a 5% return, it will be worth approximately $12,331. That’s not too shabby! Additionally, eliminating high-interest debt and searching for methods to economize on your monthly expenditures now can make a significant difference in how long your savings will last once you reach your retirement years.

2. Take Advantage of Catch-Up Contributions

For those 50 and older, the fear of not having enough money in retirement, especially if you’re just starting or have little saved, can be overwhelming. There is, however, good news as you may be able to make catch-up contributions depending on the type of retirement plan you have. For tax year 2020, those 50 and older are allowed to save an additional $1,000 in their traditional or Roth IRA. The catch-up contribution limit for 401(k) plans, 403(b) accounts, or a 457(b) is $6,500 in 2020 and 2021. You can also put an extra $3,000 in your SIMPLE plan, but no catch-up contributions are allowed for a SEP IRA.

If the Securing a Strong Retirement Act of 2021 (nicknamed SECURE Act 2.0) that the House Ways and Means Committee recently approved becomes law, those between the ages of 62 and 64 who are still working will be able to make even larger catch-up contributions.

 3. Consider Working Longer

You most likely don’t want to work forever, but the longer you work, the longer you are able to save for retirement. And, as noted above, with the additional contributions available to those 50 and older, there is potential to significantly increase your retirement savings if you work past the traditional retirement age.

 Additionally, the longer you wait to retire, the more money you will get from Social Security. Social Security benefits are currently calculated based on your highest 35 years of earnings, so if you continue to earn more in your later years, then continuing working may increase your benefit amount. If you wait until your full retirement age to start collecting Social Security (currently 70), you will also earn more in benefits than if you retire earlier.

4. Hire a Financial Advisor 

Putting together a retirement plan can be difficult, especially if you start late and are not well versed in all the options available to you. Financial advisors offer a wealth of expertise and information that can assist you in achieving your retirement objectives. This includes not only the best retirement savings vehicles to use but other strategies to consider, such as home equity loans, insurance coverage, Medicare planning, tax planning, and more.


At PS & G Financial Partners, we prepare you for all life's possibilities by providing protection, savings, and growth strategies designed to accomplish your most important financial goals. If you would like help with your retirement planning, please contact us today.

*Registered Representative of, and Securities and Investment Advisory Services are offered through Hornor, Townsend & Kent, LLC. (HTK). Registered Investment Advisor, Member FINRA/SIPC. 214 Overlook Circle, Suite 120 Brentwood, TN 37027. 615-846-3322. HTK is a wholly owned subsidiary of The Penn Mutual Life Insurance Company.  PS&G Financial Partners are not affiliated with HTK.  HTK does not provide legal and tax advice. Always consult a qualified tax advisor regarding your personal tax situation and a qualified legal professional for your personal estate planning situation.

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