If you’ve reached your 30s, 40s, or even 50s without building a retirement nest egg, you’re not alone – and you’re not out of options. Many people wonder when the best time is to start saving for retirement. The honest answer is: the earlier, the better. But if “early” has already passed you by, the next best time is right now.
Starting to save for retirement later simply means you’ll need to be intentional and disciplined about your savings strategy. Here is a step-by-step on how to start moving toward your retirement goals, no matter when you begin.
Step 1: Build a Balanced Budget
The first step in catching up is knowing exactly where your money goes each month. Track your income and expenses for 30 days, then create a realistic budget that includes a dedicated line for retirement savings. Even if you can only start small, consistency is key. Over time, those contributions add up.
For example:
- If you’re figuring out how to start saving for retirement at 30, you might aim for 10–15% of your income.
- If you’re wondering how to start saving for retirement at 40 or how to start saving for retirement at 50, you may need to aim higher and reduce other spending to catch up.
Step 2: Take Advantage of Available Programs
Many employers offer retirement savings accounts like 401(k) plans, which allow you to save pre-tax dollars and sometimes receive matching contributions. If you’re self-employed or your employer doesn’t offer a plan, Individual Retirement Accounts (IRAs) can be another option.
You could also consider Health Savings Accounts (HSAs), which can be used for qualified medical expenses now and in retirement, helping reduce financial strain later in life.
For those in their 60s or approaching retirement, look for senior programs and community discounts that free up more money for savings. Every dollar saved in expenses is a dollar you can put toward your future.
Step 3: Set Aggressive but Realistic Goals
When you start late, you may need to save more aggressively than someone who began earlier. Decide how much you need, how many years you have until retirement, and how much you can contribute each month. Then, most importantly—stick to the plan.
It can be motivating to set milestones, such as increasing your contribution rate every year or reaching certain savings goals by specific birthdays.
Step 4: Stay Flexible and Keep Learning
Life changes, sometimes unexpectedly. So it’s important to revisit your plan regularly. If your income grows, increase your savings. If expenses rise, adjust your budget but keep that retirement contribution intact whenever possible.
It is good to do your own research about what options are available to you. Various resources can assist you and your needs in outlining practical steps and implementing your specific goals.
Get Started and Stay Positive
While the best time to start saving for retirement was years ago, the second-best time is today. Whether you’re 30, 40, or 50+, taking action now can help you build a more secure and comfortable future. With a clear budget, the right accounts, and consistent contributions, you can make up for lost time and prove that it’s truly never too late to start. You’ve got this!