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Top 3 tips for catching up on retirement savings if you didn’t start early
Here's how to get back on track, fast.
Laura Shallcross
05.03.21

Not all of us are as well-equipped for retirement as we’d hope to be.

It all depends on your situation when you were younger. Perhaps you were lucky enough to work with an employer who put money into a retirement pot on your behalf.

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But if you were left to sort out your own retirement savings when you were a youngster, you likely didn’t bother. Who wants to say goodbye to a chunk of their hard-earned cash every month, only to be reunited with it some 50 years down the line?

But, as we all know, those 50 years flash by much faster than our younger selves would believe!

You’re fortunate if you did start saving for retirement early, but it’s definitely not the end of the world if you didn’t.

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If you’re nearing retirement and want to save money, fast, there are three simple steps you should follow:

1. Ask An Expert

Most of us are wary of spending money on a financial advisor, but it’s actually one of the best investments you can make, as an expert will help you to save more money going forward.

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Financial advisors can offer invaluable advice when it comes to saving to meet your retirement goal. They can also help you to make investments that you probably would have been too daunted to make alone, or that you never knew about personally. A financial advisor can help you to feel more confident in your investment decisions, and they won’t judge you if you’ve started saving for retirement late.

2. Choose A Retirement Account

If you’re still at the very beginning, you’ll need to start by choosing a retirement account. Perhaps your employer offers a 401(k) or 403(b) with a contribution match, and this is definitely something to take advantage of. But there’s no reason to stop there.

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A second option, both for people who aren’t offered a contribution match retirement account with their employer and people who just want to expand their options, is an IRA. IRA models can be set up independently from your employer, and often, you have easier access to your money if you need it before you retire.

3. Contribute What You Can Afford

Retirement accounts typically have a maximum yearly contribution amount, and their tax benefits make them incredibly alluring.

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It can be tempting to contribute the max yearly contribution, but if you can’t afford it, don’t push it. Those guidelines are set up for everyone, and that includes the high-earners, so don’t feel pressured to make financial commitments that will stretch you too far. You’re not competing with anyone else – this is for you.

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These three tips can help you to gradually catch up on your retirement savings if you didn’t start early.

I would recommend making sure you’ve got these covered before looking at how else you can save more money, faster – but there are plenty of tips you can follow when the time comes.

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For instance, paying off any high-interest debt as quickly as possible will work in your favor, even if it means sacrificing your retirement contributions for a couple of months.

It’s also worth taking a look at your expenses and deciding what you could live without.

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There are plenty of ways to save money, but remember to only put aside what you can afford to save.

You want to enjoy your retirement, sure – but you want to enjoy life before then, too.

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By Laura Shallcross
hi@sbly.com
Laura Shallcross is a contributor at SBLY Media.
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