If you’re between 45 and 60 and have recently realized that you may be behind on saving for retirement, you may feel a wave of concern or even panic. You might be thinking, “I should have started sooner,” or “How am I going to catch up now?” If so, take a deep breath. You’re not alone—and more importantly, you’re not out of time.
Many people in their late 40s, 50s, or even early 60s have competing financial priorities: paying off a mortgage, supporting children through college, helping aging parents, covering healthcare expenses, or recovering from earlier financial setbacks. It’s common to get to midlife and recognize that retirement is suddenly much closer than it seemed just a decade ago. The key is what you do next.
It’s Not About Blame
One of the biggest reasons people find themselves behind is simple: most of us were never taught how retirement saving works. Financial literacy has not been a part of school curriculums for many generations. Concepts such as compounding, tax-advantaged retirement plans, employer matches, Roth vs. Traditional IRA accounts, and future income planning are rarely discussed in classrooms.
So if you feel behind, understand this is not a moral failing. It’s often the result of a lack of early guidance. Moving forward with knowledge and intention is what matters now.
Start with $50 to $100 per Month
When you feel far behind, small numbers may feel insignificant. But consistency compounds over time. For example, saving just $100 per month with a moderate annual return can accumulate meaningfully over a 10- to 15-year period. The goal at first is not perfection, but rather momentum.
If you need to start at $50 per month, do it. Making saving a non-negotiable line item in your budget builds a habit that you can increase gradually. Think of this stage as “turning on the faucet.” Once the water is flowing, it becomes easier to increase the flow.
Leverage Your Job’s Retirement Plan
If your employer offers a 401(k), 403(b), or SIMPLE IRA, your participation can be one of the fastest ways to build up retirement savings. If you aren’t currently enrolled, take that step as soon as possible. If your employer offers a matching contribution—such as 50% of your contributions up to a certain percentage—try to contribute at least enough to get the full match. That’s additional money that will automatically be working for your future.
Already contributing to a retirement account? Consider increasing your savings rate by 1 or 2% whenever you receive a raise. If you get a 3% pay raise and increase your retirement contributions by 1%, you still receive a net increase in take-home pay while also accelerating your progress toward retirement.
Reduce Spending and Debt
Your budget may be stretched in your late 40s and 50s, but there are often areas where spending can be optimized. Consider reviewing your recurring subscriptions, dining and entertainment spending, or unused services. Freeing up even a few hundred dollars per month can be meaningful.
Using this cash flow to pay down high-interest debt is often one of the best next steps. Credit card debt, for example, carries interest rates that can significantly erode financial progress. Paying it down may improve your long-term cash flow, allowing you to redirect those dollars into retirement savings later.
Make Catch-Up Contributions (Age 50+)
If you’re age 50 or older, IRS rules allow higher annual contributions to retirement accounts through “catch-up contributions.” This is an intentional provision designed to help individuals who may be behind. Even if you can’t immediately max out contributions, increasing them gradually as your financial breathing room improves may make a meaningful difference over the next decade or more.
For example, adding just a few extra thousand dollars per year in your 50s can improve your retirement readiness over time.
Rethink Your Timeline Expectations
If your retirement timeline feels tight, consider whether a few adjustments might improve your path. Options may include:
- Working a few extra years (if health and career satisfaction allow)
- Transitioning into part-time work during early retirement
- Considering phased retirement if your employer offers it
- Adjusting lifestyle expectations based on needs rather than luxuries
Extending your working years even slightly can reduce the number of retirement years you need to fund, thus giving your investments more time to grow and delaying withdrawals to ease the pressure on savings.
Visualize an Annual Retirement Income
It’s common to think about retirement savings as a dollar goal (e.g., “I need $500,000 or $1 million”). But it may be more practical—and less overwhelming—to think in terms of replacing income. Ask yourself: How much income will I need each month (or year) to cover essentials and discretionary expenses?
This shift in thinking often helps people feel more in control. From there, you can create strategies using Social Security, employer pensions (if applicable), retirement accounts, and possibly part-time income to bridge any gaps.
A Finincial Professional Can Help
Trying to catch up without a plan can feel like driving without a map in unfamiliar territory. A financial-planning professional can help you:
- Understand exactly where you stand today
- Prioritize between debt repayment and retirement contributions
- Determine how much you can save today, and then find ways to ramp up your retirement contributions
- Create tax-efficient strategies for your savings
- Plan for realistic retirement timelines and income sources
- Hold you accountable and make adjustments as life changes
Having a clear, actionable roadmap may help reduce stress and keep you focused on progress rather than fear.
Remember: You Still Have Time
Feeling behind doesn’t mean your retirement dreams are over. It simply means it’s time to take focused, intentional action. Whether you begin by contributing $50 a month, increasing your 401(k) deferral, or planning your debt-payoff strategy, each step you take now increases your control over your financial future.
You don’t have to do this alone. A financial planning professional can help you sort through your options, build a strategy that fits your life, and help you move from uncertainty to purpose-driven progress.
Today is not too late. It’s your turning point!
The opinions voiced here are for general information only and are not intended to provide specific advice or recommendations for any individual. Grace S. Yung, CFP®, is a Certified Financial Planner™ practitioner and the CEO & Founder of Midtown Financial Group, LLC, in Houston. Since 1994, she has helped LGBTQ individuals, domestic partners, and families plan and manage their finances with care and expertise. She is a Wealth Advisor offering securities and advisory services through LPL Financial, a Registered Investment Advisor. Member FINRA/SIPC. Grace can be reached at grace.yung@lpl.com.For more information, visit www.midtownfg.com or www.midtownfg.com/lgbtqplus.10.htm.
