Many people agree that saving is easier said than done. And saving enough to live off in retirement is no easy task by any means. It takes years of diligence and hard work. But what if you haven’t been able to save or if you were forced to tap into your 401(k) for an unexpected reason? What can you do? Is there still time to save for retirement or is it too late?
Well, the answer is, it’s never too late. While it can be an uphill battle, you aren’t out of luck yet.
Here are 5 ways to catch up on your retirement savings:
Catch up – 401(K)
If you’re over 50 years old, you can take advantage of the catchup provision. Meaning, instead of saving the maximum yearly contribution of $19,500, you can put away up to $26,000 a year! Saving with the maximum catchup provision for 10 years will add $260,000 to your 401(k), and that’s not including gains from your rate of return.
Catch up – IRA
The catch-up provision also applies to IRAs! Those age 50+ can save a combined total of $7,000 per year in their traditional IRA and Roth IRA accounts. Of course, income limits do still apply to IRAs so be sure to check if you qualify for this type of retirement Savings account.
Delay Social Security
Social security becomes available at age 62, however, that does not mean you need to start taking social security at 62. Delaying social security will allow your payments to grow by 8% a year from age 63 until 70. If your income isn’t dependent on social security this may be an option for you.
Downsize
This option is great for those who no longer have their children living with them. Downsizing your home can bring down your mortgage payment, meaning the money you are no longer spending on your mortgage can be allocated to your retirement savings. Or, if you have already paid off your mortgage, selling your home could give your retirement savings a nice bump.
Work longer
This option is probably the least popular as many of us have been working hard for years and want to retire as soon as we can. However, if you’re retirement savings account could use a boost, you may want to consider working a few more years. Consider meeting with a financial advisor to discuss your current savings and estimated retirement income to find out if working longer will be necessary.
If all else fails, you can always try your luck at the lottery. But we recommend sitting down with a Financial Advisor to go over your options instead. Our fiduciary advisors focus solely on retirement. We can help ensure you are on the right track and answer any retirement questions you may have along the way. Don’t go it alone, schedule your complimentary retirement review today!
Any opinions are those of Kowal Investment Group. This material is being provided for informational purposes only and is not a complete description, nor is it a recommendation. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or a loss regardless of strategy selected. Prior to making an investment decision, please consult with your financial advisor about your individual situation.
Kowal Investment Group, LLC (“Kowal”) is a Registered Investment Advisor (“RIA”). Kowal provides investment advisory and related services for clients in State of Wisconsin and other states. Kowal will maintain all applicable registration and licenses as required by the various states in which Kowal conducts business, as applicable. Kowal renders individualized responses to persons in a particular state only after complying with all regulatory requirements, or pursuant to an applicable state exemption or exclusion.
