You’re finally in a place in your life where you feel like you can start investing in your retirement. The only problem is that you’re starting late.
Don’t let this stop you. Yes, you’ll have to work a lot harder, but it can be done. Let’s look at how to save for retirement when you’re starting late.
Plan to Retire Later in Life
Since you’re starting late, you need to face the facts that you’ll need to push off retirement for a few years. You’ll need as much money as you can get from Social Security. Instead of retiring at 65, you will want to think about retiring at 67 or later.
Invest in More Than One Account
You want to take advantage of the retirement account offered to you at work. Some employers will match a certain percentage of your investments. You want to invest as much as you’re allowed to. Currently, the limit is $18,500 if you’re less than 50 years of age. If you are over 50 years old, you can also take advantage of catchup payments.
However, that’s not the only account you can have. You can also have an IRA but the amount may not be tax deductible. It’s still essential for retiring. Speak to an investment specialist to see what will work for you.
Create Passive Sources of Income
A passive source of income is something you do once and get paid for multiple times. A great example is writing a book and publishing it on Amazon. You’ll continue to get paid for as long as you’re making sales.
Be Aggressive at First
You may still be young enough to invest aggressively. This means you’ll invest in high-risk stocks with the most chance for big rewards. Later in life, you’ll switch to safer stocks to maintain rather than fiercely grow your balance.
Cut Unneeded Expenses
If you’re serious about wanting to retire, you need to let go of anything you don’t need. Making sacrifices now will ensure you get to live out old age without worry.
Save Until It Hurts
Last, but not least, you need to save as much money as you can. Yes, it will hurt to put everything you’re making towards bills, living expenses, and retirement but what’s more important? Living a life of luxury now or being able to retire?
Even if you’re in your forties or fifties, you can still save for retirement. You just need to be aggressive in making sure your money is saved for the future.