15 Dec Is It Too Late to Begin Retirement Planning in Your 50s?
By the time we reach our 50s, retirement is no longer an abstract idea nor is it too far off in the future. It’s no longer a dream or something to look forward to – rather, it is actually more like a rapidly-approaching reality and that reality tends to intensify when many people reach their 50s.
Perhaps what also makes the reality more real is the fact that many people do not have a retirement plan in place or their plan is severely lacking. By this time, your plan for retirement should be rock solid and your finances should be in a good place. That is a lot of “shoulds”, we know, but the reality is, too many people enter their 50s without a solid plan or any plan at all.
If You Don’t Have a Plan, Is It Too Late?
We realise that many people do not have a plan, and if you’re without one, then you’re not alone on this. However, the great news is, it is not too late to put a solid plan in place and begin working at it. Even in your 50s and even if you’ve only got 12-15 years left in the workforce.
Will you have the retirement of your dreams at this point? It’s hard to say since every financial situation is different. Point being, you still have time to get working on providing yourself with some financial stability when retirement finally comes knocking at your door. No matter when you start your plan, you will be much better off compared to those who never even made an attempt at starting.
The point is not to compare, but unfortunately, too many people do not plan at all, despite having ample opportunity to do so. We understand that not everyone has the know-how, the will power, or the funds to even get started on a solid plan, which is one of the many reasons why the world needs financial planners and advisors to ensure people get off on the right path, no matter where they are on life’s trajectory.
We’ve outlined four things you can do on your own to get yourself started on the right path. This is not a guaranteed financial plan, but these steps provide you with a great starting point. Once you sit down and start taking a look at your entire financial picture and plan for the future, you may realise that you are not as far gone as you may believe.
Step One: Take a Look at Your Budget
Take a close look at your current expenses and expenditures. If you are somewhat close to the age at which you are hoping to retire, it might be a good idea to think about limiting yourself to getting by with the essentials. Instead of making those large or extra purchases you’re used to making, you can take the money you would have spent and drop it into your retirement fund.
This could make a huge impact on how well you retire, but will mean going without certain things for a few years. It isn’t going to be easy, but will be well worth the effort and sacrifice when you can finally retire and enjoy yourself in what should be a wonderful stage in your life.
When going through this step, ask yourself:
- Where could I stand to save some money?
- Are there cutbacks I can make that won’t impact the quality of my life?
- Examine every monthly deduction and ask yourself, is this necessary?
After going through this process, you may quickly discover that you have a nice little sum of money to drop into retirement each month.
Step Two: Find a Financial Planner
One of the biggest reasons many people do not plan for retirement is because they often feel as though they have to do it all on their own. The reality is, you do not have to go it alone. Do some research and find resources you can take advantage of. You may want to find a financial planner and sit down with them for a free consultation to see what they have to offer and how they may be able to help you get on track.
By consulting with an experienced professional, they may be able to show you a plan that is reasonably attainable at your current stage in life.
Step Three: Consider Supplementing Your Income
If you’re in your 50s and you’re starting to put a solid plan in place but aren’t sure if you will have enough money put aside by the time you retire, then considering a supplemental income may be the best way to go. This could include taking on a second part-time job, freelancing, or finding ways to create a passive income.
This may not be an ideal situation since you will be spending more time at work, but think about the end result of having extra funds put aside when you reach retirement. When speaking with a planner, ask them about stock and investment options as this may be a good option for you and your current situation.
Step Four: Consider Retiring a Little Later
As you examine your expenses, you may realise that you might need more time in the workforce to prepare by building up a larger nest egg. While this may not be an option for everyone, it is not uncommon to see people delaying their retirement by a few years, so they can put more money aside. If this is an option for you, it may be worth considering.
Planning for retirement is not easy when you start in your 50s, but it is certainly not impossible. If you are in your 50s and you’re freaking out, it’s okay. Take the time to consider some of these steps and try sitting down with a planner to see how you can get assistance in getting started on the right track to an enjoyable retirement.