Wednesday, March 20, 2019
By Barbara Pronin
If you’re in your fifties and short on retirement savings, the money mavens at The Motley Fool remind us, you are not in a good place. Most seniors will need 70 to 80 percent of their previous income to live comfortably, and Social Security will provide only about half of that.If you’re looking at that scenario, you are right to worry, according to financial advisors. But it isn’t time to panic - yet - if you take the following three steps now:
Make lifestyle changes - Downsize your living space. Become a one-car family. Eat out less often and cut down on clothing buys and other nice-but-not-necessary expenses. If you can manage to free up $500 a month to save over the next 15 years, and your investments generate an average seven percent return, you’ll be on track to accumulate $150,000 - not a huge amount, but a better position to be in.
Get a side gig - You can only cut back on so many expenses before there is no lifestyle left. The obvious answer is to generate more income with a side hustle. Figure out what you can do. If you can bring in $500 a month in addition to the $500 you are saving, you will be on track to accumulate $300,000 by age 65.
Plan to work a little longer - It’s hard to push yourself to keep working when you’ve been looking forward to retiring. But working longer means more time to contribute to your retirement plan. Also, the longer you delay taking your Social Security benefits, the higher the amount you will receive when you do retire.
With Americans living longer these days, the last thing you want to do is be dreadfully short of funds in your senior years. Resolve now to do what it takes to put yourself in the best financial position possible.
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