What to Do If You’re Starting Retirement Saving Late

The best time to plant a tree was 20 years ago. The second-best time is now.

Introduction

Maybe life got in the way. Maybe you didn’t earn enough early on. Maybe you just didn’t realize how fast time would pass. Whatever the reason, if you’re in your 40s, 50s, or even 60s and haven’t saved much for retirement — you are not alone.

The good news? It’s not too late. While you may need to make some trade-offs, you still have powerful tools available. In this article, we’ll walk through what you can do right now to catch up on your retirement savings and build a more secure future.

Step 1: Get Clear on Where You Stand

Before you panic or dive into spreadsheets, take a breath and get the full picture:

• How much do you currently have saved?
• Do you have any pensions or Social Security estimates?
• How many years do you realistically want or need to keep working?
• What are your expected monthly expenses in retirement?

This helps set realistic goals. You might not need as much as the “$1 million” rule suggests — especially if you plan to downsize or live modestly.

Step 2: Max Out Catch-Up Contributions

If you’re age 50 or older, you can contribute more to retirement accounts than younger savers:

• 401(k): Up to $30,500 total in 2024 ($23,000 + $7,500 catch-up)
• IRA (Traditional or Roth): Up to $7,500 total in 2024

If you can max out both, that’s $38,000 in tax-advantaged savings per year — a serious boost if you have 10+ years to grow it.

Step 3: Consider Delaying Retirement

Every year you delay retiring means:

• More years of earning and saving
• Fewer years of drawing down your savings
• Higher Social Security payments when you start claiming

Delaying retirement by just 2–3 years can dramatically improve your financial outcome — especially if those are high-income years.

Step 4: Optimize Your Spending

Saving more doesn’t just mean earning more. Often, the key is spending less.

• Eliminate high-interest debt
• Downsize housing or relocate to a lower-cost area
• Reduce recurring expenses (subscriptions, dining out, etc.)

Every dollar you don’t spend is a dollar that can go toward catching up — or making retirement more sustainable.

Step 5: Reassess Your Investment Strategy

If you’re starting late, your money needs to work a bit harder — but that doesn’t mean swinging for the fences.

• Avoid ultra-conservative portfolios with low returns
• But also avoid high-risk bets that could wipe you out
• Consider a balanced mix of stocks and bonds — or a target-date fund

Optional: Use a Monte Carlo simulation to model your retirement outcomes across different market scenarios.

Step 6: Use Every Account Available

Don’t just rely on one account:

• 401(k): Tax-deferred savings through your employer
• Roth IRA: After-tax savings with tax-free withdrawals later
• HSA: If eligible, this triple-tax-advantaged account can be used in retirement too

Each account offers different tax benefits — using them together can help maximize flexibility.

Step 7: Have a Social Security Strategy

Social Security may be a bigger part of your plan than you expected — especially if you’re starting late.

• Claiming at 62 = smaller monthly checks, but more of them
• Waiting until 70 = fewer checks, but up to 76% more per month

Consider delaying benefits if possible — it can act like an inflation-adjusted lifetime annuity.

Step 8: Stay Consistent and Keep Perspective

Don’t get discouraged by comparison or perfection. What matters is what you do now.

• Set up automatic contributions so you don’t have to think about it
• Track progress every 6 months, not daily
• Celebrate small wins — every dollar saved is forward progress

Conclusion

Starting late is not the same as giving up. By getting intentional, using catch-up rules, and making smart choices from here on out, you can still build a meaningful, resilient retirement plan — even if you're getting a later start.

Next up, we can walk through what it looks like to combine Social Security, a small savings pot, and part-time income to create a flexible retirement lifestyle — even without hitting $1 million.