What to do if you’re behind in retirement planning to create a more financially secure future.

If your retirement account is behind on savings, planning for retirement can be stressful. But it’s important to remember that it’s never too late to save for retirement. Consider these strategies to help you create more financial security for your future.

Have a plan

Having a plan in place can help alleviate financial stress because you know exactly where your finances stand and what steps you need to take to accelerate your savings. It puts you in control instead of simply worrying that your savings and Social Security won’t be enough.

Many financial experts say you’ll need 80% of pre-retirement income in retirement. Compare what you’ll need to what your current retirement savings are projected to provide when you retire. When you use the Consumers Retirement Income Calculator you can adjust variables such as age at retirement and annual contributions to see how different scenarios could play out. Once you know your future needs you can work back from that figure to determine how much you need to save now.

Maximize 401(k) contributions

Everyone should take advantage of employer matching 401(k) programs. At a minimum, set aside enough to get your employer’s maximum contribution. If you’re behind on retirement savings, consider setting aside even more than the matched amount.

Take advantage of catch-up contributions

Anyone over the age of 50 can take advantage of tax rules that allow you to make catch-up contributions to qualified retirement plans each year. The rules allow you to put an extra $1,000 in your IRA in 2022 for a total of $7,000. For those participating in a 401(k), 403(b) or 457 plans the maximum standard contributions of $20,500 can be supplemented with an extra $6,500 in catch-up contributions for individuals 50 or older.

Keep in mind that you can make a catch-up contribution that’s less than the maximum. Any amount can help accelerate your savings.

Evaluate your spending

Catching up on retirement savings requires a holistic look at your finances, including your daily, monthly and annual spending. Examine where your money goes and identify expenses that you can reduce or eliminate.

As you evaluate spending, consider changes small and large. Consider eating at home more versus going out or downsizing your home to reduce expenses.

Enlist help

You don’t have to figure out retirement planning on your own. Give us a call at 800-991-2221 and we can connect you with a financial advisor that can help design an individualized plan for your future.