Making up for Lost Time

Almost 60% of Baby Boomers admit being behind in saving for retirement, and there are untold others who don’t even know where they stand. So if you’ve procrastinated you are not alone, but there’s hope. Here are some tips for catching up, even if you are off to a late start.

1. Save More
   Would you really miss another 5% of your income, if it were taken from your paycheck and automatically stashed away for retirement? You could adjust, couldn’t you, by cutting some expenses or adding to your income by moonlighting?
2. Get on Track
   Unless you have figured out how much you’ll need to save for retirement, your retirement plans are based on wishful thinking. The internet abounds with sites you can use: I like the calculators at ChooseToSave.org, where you can click on “Ballpark Estimate” and answer a few short questions to see whether you are on the right road to accumulating what you need.
3. Invest Wisely for Retirement
   If you are off to a late start, go for growth. If you have at least ten years until retirement, get your retirement funds out of the bank and into a mix of stocks and bonds that is appropriate to your age.
4. Scale Down
   Most people plan to reduce their expenses in retirement and live a simpler life. Here’s an idea – try scaling down and get used to living on less right now. If that’s impossible, then at least don’t increase your expenses when you get a raise – instead, sock the money away for retirement.
5. Pay Down Your Home Mortgage
   If you stop borrowing against your house, and instead make extra payments on your home equity loans and mortgage, by retirement you may have enough equity to move somewhere less expensive and reduce your payments.
6. Plan to Work During Retirement
   It is nice to have the extra income from working part time or intermittently in the early years of retirement. Working is also good for you. People who work part time stay mentally alert and challenged and are better able to maintain a healthy social structure. The choices you make today profoundly impact your tomorrows. If you can’t seem to get control of all the pieces that will add up to a successful retirement, turn to professionals for advice. Just as some dieters do better in a diet program than on their own, many investors do better when they have a professional guiding them.