No Retirement Savings at 45+? (It's Not Too Late!)

January 11, 2022
If you have no retirement savings, don't panic. It's possible to start saving when you're 45, 50, even 60, and still retire, but you need to start now.
Britt and Laurie-Anne two women laughing and looking at their computers on a couch in a well-styled living room
Britt & Laurie Anne
Two female investors in their 30s with a collective net wealth of over $6 million+
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The other day, I was catching up with an old friend and I realized we'd been friends for 27 years. I never thought I would have a friendship that long, but that's how life works. The older you get the faster time seems to fly by. And when retirement is looming, man, does it start to speed up!

If you have no retirement savings, don't panic. It is possible to start saving when you're 45, 50, even 60, and still be able to retire, but you have to treat it like the house is burning down, so pay attention.

Here are six steps to catch up on saving for retirement.

1) Get Real About Your Situation

How much have you saved for retirement so far? How much will you get from Social Security? Plug those numbers into a retirement calculator to see how much more you need to save each month to be able to retire.

2) Start Saving -- Dramatically

If you have no retirement savings at 50, you need to start saving and investing 50% of your income each month. This means that you're probably gonna either need to reduce your cost of living or increase your income. If neither of those options are possible, you need to get real about your alternative, which I'll talk about in #6.

3) Pay Off High-Interest Debt and Build an Emergency Fund

These are crucial steps in our five-step roadmap to build wealth and you can't skip over them, even if you have no retirement savings and you feel stressed. You need to pay off high-interest debt and build an emergency fund before you start saving for retirement.

no retirement savings - how to build wealth

High-interest rate debt costs you more than you can make by investing your money or leaving it in a savings account, so if you have any savings sitting around in a savings account, use it to pay off your high-interest rate debt ASAP. Then you'll wanna build up an emergency fund.

Keep in mind that if you have a backup plan, this emergency fund doesn't have to be huge. You want to start saving for retirement as soon as possible, so don't let this step hold you back if you have family who will support you in case of an emergency.

4) Max Out Your Contributions

If you're 45 or older and have no retirement savings, saving for retirement should be your number one priority, so contribute as much as you can to your retirement accounts.

If you have an employer-sponsored retirement account like a 401(k )or a 403(b) and your company offers matching contributions, contribute as much as your employer will match. This is free money, so take full advantage of it.

If you don't already have an IRA, set one up and max out those contributions as well. If you're self-employed, open a solo 401(k) or SEP IRA and max out those contributions too. (Are you picking up on a theme here?) Finally, if you have a high-deductible health plan, you can open an HSA and max that out too.

Basically, you wanna save as much money as you can in your various tax-advantaged accounts. Remember that if you're 50 or over, you're allowed to contribute a bit more than the standard maximum, so find the maximum amount for you and contribute that.

no retirement savings

5) Invest Your Savings

People ask me all the time if it's too late to start investing. My answer? Absolutely not.

Keep in mind that you don't have to take all of your retirement money out when you retire. You only need to take out enough to live on each month. Let the rest of the money stay invested and continue to grow, which could end up being another 30 years after retirement.

6) Plan For Your Realistic Retirement

Once you've done the exercises in step one to figure out your current situation you're in, figure out if you're going to have to work longer than you hoped. You might need to be making income for longer than you expected and the sooner you know that, the more you can prepare for it.

The next thing to consider is if you'll have to move somewhere with a lower cost of living. This might be why some people choose to retire in Mexico. Cost of living is really expensive in the United States, especially in big cities.

If it's gonna make your retirement a lot easier and a lot happier, consider a change in lifestyle. You might also have to downgrade what you are used to to be able to afford to stop working.

If that's something you're struggling with, consider the trade-offs. Would you rather keep up your current lifestyle but have to work for a long time or would you rather retire and spend time with your grandkids or friends or pursuing new hobbies?

Whether you wanna travel or take art classes or spend time with family, you wanna be able to enjoy your retirement without stress. If you want some extra support on your journey toward saving money so you can retire, check out our free class, Think Like an Investor.

Remember it's never too late to start saving for retirement. Even though you have little or no retirement savings and are getting a late start, it's okay. You have time. Just make sure to start saving for retirement now.

If you want some extra support in achieving your financial goals, feel free to join our member community, the Million Dollar Year. We support thousands of women+ as they are just starting to save retirement in their forties and fifties, so we've got you if you want the extra help.

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