In Elder Law News

When it comes to retirement planning, many Americans find themselves underprepared. A majority of baby boomers (born between 1946 and 1964) and Generation X’ers (born between 1965 and 1978) often end up without retirement savings or don’t have realistic expectations about post-retirement costs. According to the Insured Retirement Institute, only 25 percent of boomers are confident of having sufficient savings in retirement. If you are in your 50s and nearing retirement without substantial savings or a plan, don’t despair — it is never too late to start planning.

Although every working professional should contribute towards retirement from their early days, for various reasons they often delay the process. If you are nearing your 50s without a post-retirement plan and see yourself working for another 10 to 15 years, this is an opportunity to plan judiciously and save for your retirement right away.

Here are five strategic steps for achieving the best retirement plan:

1. Set Specific and Practical Goals

Proper retirement planning begins with setting specific goals. Calculate your current income, total savings, and ongoing investments to understand how much you could save, and be sure to set realistic goals.

While providing for emergency expenses and paying off a mortgage can be your short-term and intermediate goals, saving up for retirement should be your long-term goal. An annual financial review is helpful in evaluating your past goals and understanding your earnings as well as liabilities.

2. Plan a Realistic Budget Focusing on Retirement

Review your monthly and yearly expenses and list the factors that are likely to remain constant for the next few years. Now allocate funds to each category in a way that will allow you to save more for your retirement.

According to financial experts, if you are saving for retirement after 50, it is best to contribute 30 percent of your salary towards this end. If you find that goal difficult to meet, look at your budget list and reduce optional expenses.

3. Pay Off Debts

Paying off debts early will help you meet your retirement budgets and ease the financial burden. According to an AARP report, 44 percent of Americans continue to pay for their home after they retire.

Clearing off outstanding debts, credit card bills, loans, and mortgages will make it much easier to prioritize retirement funds.

4. Invest in Retirement Plans

401(k)s, 403(b)s and IRAs are some of the retirement plans available in the U.S.  While 401(k)s are one of the most popular plans, not all companies offer them and those that do have their own, often restrictive, investment rules. Then there are two types of IRAs:  traditional and Roth IRAs.

To make the best choice among the many retirement plan options, it is essential to have a thorough understanding of IRA vs 401(k), Roth IRA vs 401(k) and other investment alternatives, as well as  contribution limits.

5. Diversify Your Investments

Investment diversification will help keep you on a firm financial footing. Do not stash all your money in banks; instead, create an investment portfolio and explore your options.

It is important to diversify and distribute your money among multiple sectors. Considering the volatility of markets, diversification of your investment portfolio safeguards your capital and helps it grow.

It’s Time to Step Up a Gear

A concrete retirement plan with emphasis on savings is essential to ensure a comfortable and healthy post-retirement life. Saving for your retirement is the first priority and the sooner you start, the better your chances of achieving your retirement goals.

Rick Pendykoski is the owner of Self Directed Retirement Plans LLC, a retirement planning firm based in Goodyear, Arizona. He regularly writes for blogs at MoneyForLunch, Biggerpocket, SocialMediaToday, NuWireInvestor and his own blog for Self Directed Retirement Plans. Email or visit


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