Late to the Retirement Race? Strategies for Catching Up

Late to the Retirement Race?

Whether you got a late start or you just plain haven’t been saving enough, there are ways you can start to increase your retirement savings now.

The Best Time to Save is Now

If you are in your 20s and 30s, you still have the luxury of time when it comes to saving for your future. Beyond your 30s, it is time to get realistic about your savings strategies.

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Many Baby Boomers started late. Americans ages 55 to 64 who have retirement accounts have accumulated approximately $104,000 in savings*. That will produce just a few hundred dollars a month to add to their Social Security payments. Those without a retirement account have accumulated about $14,500 for retirement. Most likely, they’ll need more.

How much should you save?

That depends on many factors: your age, marital status, the age you plan to retire and what kind of lifestyle you want in retirement. The chart shows basic guidelines financial planners use:

How much you should save depends on several factors like age, marital status and lifestyle. Catching up to your retirement goals may require you to save more.
% of Income for Retirement Savings

Strategies for Catching Up

1. Reduce your expenses

You’ve probably heard it many times, but the best way to save for the future is reduce how much you are spending now. Not only does that free up money to invest in your retirement plan, but if you’re in your 50s, it also means you will be used to living on less when you retire.

2. Plan to work longer

Age 65 seemed like the magic retirement age for so many years, and was the age set for retirement in 1935 when Social Security was established. It may even be the age you are still aiming for. However, it’s best to be realistic. Working longer gives you more time to save and may help you get the best benefit from Social Security.

You get the most benefit from Social Security when you wait until your full benefit age. If your full retirement age is 67, your Social Security benefit is reduced by about:

Social Security: What a difference a year makes
Social Security Administration, Retirement Planner: Full Retirement Age article,, 2016.

3. Have the right mix of investments

While people in their 20s and 50s should not have the same kind of retirement savings makeup, you do want to make sure you have enough stock investments to keep your money growing at any age.

Sample Allocations

The Bottom Line

Regardless of where you are in your retirement savings timeline, the best time to review your retirement savings strategies is now. Learn how to build your plan and get your goals back on track.

*National Institute on Retirement Security, The Continuing Retirement Savings Crisis, March 2015. Values represent the median amount and not the average.

The opinions expressed are those of Brent Hoskins and are no guarantee of the future performance of any American Century Investments portfolio.

This information is for educational purposes only and is not intended as investment advice.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.