Tips for Saving For Retirement in Your Later Years

Later Years Retirement Saving Tips

First Published Date : July 18, 2010 ADawnJournal.com

In a perfect world, we would all save for retirement early but life has a way of getting into the mix and changing things around us. Sometimes it can be difficult to make sure you put the money away that you need to for your retirement years and it is not uncommon for an individual to save for their retirement but do so in their 40s and 50s.

If you are in your 40s and 50s and you do not have much in the way of retirement savings, you can follow these tips to start saving in your later years:

·    Look at how much you spend and live on right now and then determine how much you will need per year in your retirement. If you spend $60,000 per year on all your bills, mortgages, debts, etc, then when you retire you will probably spend around $30,000 since many of your debts will be paid off. That means on average from the age of 65 to 85, you will need at least $600,000 saved up. Now that you know how much you need, you can start saving.

·    Look at your retirement savings plan like the Canada Pension Plan and 401(k) and determine how much you can contribute per year to help you reach your goal.

·    Talk with your employer and see if they can contribute to your retirement plans as well, and find out what the pension from your employer is like.

·    Start looking at ways that you can save money with your life at this point. Maybe downsize the home you live in, sell one of your cars, start cutting back in any way that you can. The more money you save now, the more you will have to put away for retirement. If you are able to save $10,000 per year from the age of 40 to 65, you will have saved $250,000, which is an excellent sum and almost half what we calculated you would need at $30,000 per year post retirement.

·    Probably the most important thing you can do to save for your retirement in your later years is to get yourself out of debt. When you are in debt, you are paying money every month and it can amount to a lot of money. Therefore, work to pay off your debt in the next five years and you will find that the amount you can save will triple or even quadruple. Do you want to save $10,000 per year or $40,000 per year?

Retirement is something we all look forward to but not all of us save for it. When we are in our 20s, retirement is the last thing we are thinking about but as we get closer to our 50s, the looming retirement begins to come into our sights and we need to start thinking about saving for it. You can save enough money for your retirement in your 40s and 50s; it just takes a bit of work to do it.