5 Things to Do at 50 with No Retirement Savings

by Emily Guy Birken · 34 comments

Sometimes, it seems as though personal finance advice is all about what you should have done. But we’re all able to easily identify the mistakes we’ve made in the past. The important advice is what you should do to correct those old mistakes. Shoulda coulda woulda is singularly unhelpful in those situations.

This is particularly true when it comes to retirement savings. If you’ve already received your AARP card and still have not started putting money aside for your retirement, those charts showing how much compound interest will earn you if you start saving in your 20s are depressing at best. But workers in that situation can’t afford to wallow in their “if only!” feelings, even though they might want to. Instead, they need to make a plan for the next 15 to 20 years:

1. Start putting money aside right this minute. It doesn’t matter if the amount of money you think you can afford to save is relatively low. Just putting some money into a retirement account is a step in the right direction. If your employer offers a 401k retirement plan, make sure you at least save enough to qualify for their matching contribution. It may not seem like much, but you’ll be very glad of the extra padding to your account once you start seriously thinking about retirement.

2. Downsize. If the amount that you are putting aside is not sufficient to keep you comfortable in retirement, then you need to start thinking of ways to cut your expenses so that you can add more to your retirement savings. Can you sell your house and live someplace cheaper? Can you trade your car for something cheaper, or lose it altogether? Are you paying for memberships or subscriptions that you’re not using? Do you eat out several times a week? Be willing to slash your expenses to the bone. You couldn’t ask for a more worthy cause than taking care of yourself in retirement. (Here are some more advice on how to downsize.)

3. Maximize your investments. Enough people are in the same lack-of-retirement-planning boat that there are several provisions for those who are over 50. While younger workers can only contribute a set amount to their 401k and IRAs, savers who are over 50 may funnel as much as $5,000 more every year. Take advantage of these higher limits and reap the rewards when you’re ready to retire.

4. Plan on working longer. The difference between how much you have saved to retire at 65 and the amount needed if you wait until you’re 70 can be enormous. In some cases, it can mean that you have to give up less of your lifestyle in favor of savings. If you love your job, why not just plan on staying there longer so you’ll have a little breathing room? (Alternatively, you can look into these ways to earn more money so you can still quit and enjoy income.)

5. Get professional help. When it comes to retirement planning, it can feel awfully intimidating trying to navigate the options. This is particularly true for workers who haven’t started saving before age 50, since they would likely have worked on their retirement savings sometime earlier in their careers if they hadn’t found investments intimidating. If this describes you, find yourself a qualified and objective financial planner to help you sort out your investment options. The National Association of Personal Financial Advisors can help you locate someone you can trust with these important decisions.

Starting your retirement savings late is not ideal. But rather than lament what you could have done differently, be proactive now and stick with it. You’ll be so glad you did.

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{ 34 comments… read them below or add one }

Emily December 9, 2011 at 7:58 am

Great tips, Emily! I want to add one: start a second stream of income: an online biz, MLM, Real Estate, freelancing writing, whatever fits you. That way you can live off your job income and sock away whatever you get from the other income.

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Wendell Ferrell November 3, 2012 at 11:32 am

Another way some have made money at home is making & installing hho generators to help people get much better mileage. You might be suprised at how hard this though-I’m amazed at how many people think that people CANNOT get better mpg-but I guess they believe ALL the news. Sometime we just have to KEEP ON TRYING till we find the right people. If you can afford it you could put ad in newspapers that you CAN help people get much better mpg-call (your #) for details. Details on MANY ways to get much better mpg at: http://double-mileage.blogspot.com.

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Wendell Ferrell May 4, 2014 at 12:18 pm

VERY GOOD suggestions! Also, why not do organic gardening in your back yard(if you have one), &/or container gardening?

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Maria@moneyprinciple December 9, 2011 at 12:20 pm

I really enjoyed this post and although it doesn’t apply to me so much (I did start my contributions in my 20s and am in a very good pension scheme) they are still useful. And you are very right about most of the advice being really ‘mainstream’ – start early, compound interest and the like.

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The Col December 9, 2011 at 9:50 pm

Get Dave Ramsey’s Book ,”A Total Money Makeover.” Follow the advice in it to the letter or stay destitute or at least unable to retire on any real income. I am not related to him nor do I work for him and there are a few things in the book that I just could not do because of some lock situations but its all there brothers and sisters just open your minds and force yourself to change those bad habits.

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Marbella December 10, 2011 at 6:46 am

Investing today for the future with today’s global financial crisis is a bit dangerous, maybe it’s better to save money in the bank and hope that they will not go bankrupt.

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Jean December 11, 2011 at 11:34 am

I have seen an older friend of mine sell off his car and turn to public transport recently in order to save money for retirement. He said the increasing fuel prices combined with the maintenance, insurance, etc. was just getting too much for him.

-Jean

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Red Clay December 15, 2011 at 8:33 am

Ditto on the Dave Ramsey book -great financial advice. Instead of buying a new car, buy a good used (3-4 yrs old) one & let someone else pay the high depreciation costs the first few yrs of a car’s life. When u go out to eat, get a water instead of a drink; restaurants get a high profit on beverages. Get yours at the grocery/liqour store, & enjoy at much less cost at home (or w/ your meal if u get it to go). We’ve downsized some & will some more. http://www.morningstar.com is a great site for do-it- yourself investors w/ free classrooms.

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khatlady December 15, 2011 at 8:51 am

I’m in the group of being 50 with low savings. It wasn’t that I didn’t save, I watched my IRA lose 60% with the bank fiasco and subsequent slide. I have not come close to getting it back. The only reason money is in the account is that I am still saving.

Most of your other suggestions need to be updated. My home has lost so much value, I would take a very hefty loss selling it. Rents are high. Bus service has been cut and the closest grocery story would be a 2 mile walk one way.

I am angry that everything I have worked so hard for has vanished and it is not my fault. Hard to think that the one person I know who has come out of this in good shape keeps her money in a coffee can hidden under her bed.

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KT April 25, 2013 at 9:33 am

I’m truly sorry Khatlady that you’ve taken such a hit due to this lousy economy and bad business/government decisions for the past decade. You do and did deserve better after working so hard and doing what you’ve been told you should. I hope you can get past your very justifiable anger and find a way to get back on track both economically (and psychologically) for yourself. I’ll be praying for you!

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Emily Guy Birken December 15, 2011 at 8:55 am

@Khatlady, I’m so sorry you’re in that terrible position. I can’t imagine how frustrating that must be. It sometimes feels like regular Americans have been sold a bill of goods. We’ve always believed that working hard, saving, and being thrifty would pay off with a good retirement, but that’s certainly been proved false over the past few years. I wish you the best of luck as you rebuild.

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Nirvana December 15, 2011 at 11:16 am

I sometimes think that human beings are too engrossed in materialistic stuff and forget about impermanency. As long as you can live a comfortable life with basic needs met, then improving one Karma for a better life ahead are more important.

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Lifeisdynamic December 30, 2012 at 6:32 pm

Are you thinking perhaps a camping tent, a rifle, a generator and a fresh water source? Fine for those who are still active and intend to remain that way for the rest of their lives. As for accommodation in town – well….! Can you eat Karma or does it provide a roof and physical warmth?

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Andrea Miller December 15, 2011 at 12:02 pm

Well, when I am 65, my Wisconsin state pension will be $446/month. Social Security will add just over a thousand. Then deduct the Wisconsin medicare plus insurance which is $400/month and you also have to deduct Medicare. That leaves me living on way less than $1,000/month. That is not even close to living a comfortable life.

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Kat Fud December 30, 2012 at 5:02 pm

Sounds like you don’t plan to have any savings. Small pensions and Social Security were NEVER intended to be the sole source of income for retirees, but people retire only on that, then wonder why it’s not enough. What’s more, that Social Security benefit may not be around in the same form when it’s your turn to belly up to the trough. So Save Save Save, because really, it’ll be your own @$$ you’re saving in the end.

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Lyra December 16, 2011 at 3:00 pm

Well I’m a 55 year old single woman and don’t have a cent to my name and nothing for my retirement. I had to declair banckruptcy 2 years ago and lost everything I worked so hard for. My house, my car, my business, etc.. My total income a month is $599.00 a month. After I pay my bills I don’t even have money for food so how am I suppose to save up for my retirement. Specially when I can’t find a job because of health problems. No one wants to hire you when you are coughing in their face. I tried a few online jobs that never paid out. So yea, I’m screwed. :(

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Dave January 10, 2012 at 3:56 pm

Nice article, but realistically, not everyone can or will retire. I won’t. 28% of my income goes to child support, and my ex does nothing towards their college tuition. I want the best for my kids, so that’s fine. It’s more than my parents did for me. I put myself through college, which I’m also still paying for. My credit rating is perfect, but I’ll be poor and work until I die. Oh, and the house value is now half of what I owe on it thanks to all the foreclosures in my neighborhood.

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lifeisdynamic January 19, 2012 at 12:49 pm

I am an Aussie and when I read, hear and see what you guys have been through as you approach or are in retirement, I realise just how fortunate I am as I look at my meagre but frugally saved earnings as I approach 60yo. I have lost money in my superannuation accounts (Retirement Accounts) due to the financial events in USA, and as angy as I was at the time, I have regained some ground in these accounts through diversification choices in the accounts. I am constantly afraid of what could happen again and keep a keen eye to financial events to ensure I switch down to ‘cash option’ when there is a continual trend downwards. I almost own my comfortable, largish home and still managing to pay far more than the bank requires. My home is holding its value.
For many of you it must seem hopeless – hang in there – it can only get better, surely. Thinking of you and understanding your pain.
additional: think laterally – no really. Don’t forget that spare room or two that can earn you money by taking in a student or another person on the street without a home but who has enough cash to pay for a room and board/share the home maintenance and housework; company or even has skills which could be useful and compatible with a mutual business idea working from home. …………… goodluck with thinking about it.

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YouNeverKnow April 21, 2012 at 1:26 pm

When my ex-husband’s grandmother died her family(kids) went to her home in to collect her belongings.
They discovered money and lots of it in all sorts of containers throughout the house. Cookie jars, coffee cans, between mattresses, in dresser drawers, tin cans in kitchen cabinets, several safes–etc.
When all was said and done and the money was counted, it came out to almost $200,000.
As it turns out, grandma only believed in “some” very conservative investing into solid companies with staying power such as the phone company etc. BUT she didn’t believe in putting all her money in the stock market or the banks– being that she survived the great depression with horror stories.
So she kept a shot gun and socked every bit of money her and her husband made in their home (she lucked out that there wasn’t a fire).
They lived on Social Security and Pensions from their jobs mostly. As she got older and was diagnosed with Alzheimers, she gave all of her investments to family members and gave instructions to her daughters to come pick up everything in her house the minute she died. Her daughters had no idea she had kept so much money at home.

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RealityCheckGirl April 21, 2012 at 1:57 pm

Well, i was a stay at home mom for 16 years until my husband had a long term affair with a younger woman (who eventually ended up leaving him for another married man with more money) resulting in our divorce.

When i returned to the workforce at the age of 42-i faced a considerable amount of age discrimination. Despite having a college degree and having kept my skills up through part-time and volunteer work, they only thing employers seemed to be interested in was hiring and promoting the next young thing with little to no experience or degree.
I literally did all the job functions (through a temp agency) of a 22 y/o human resource boss that was often late or absent and they still wouldn’t hire me on permanently or promote me. Other workers and contractors came to me, not her, for answers and help in hiring- being that she rarely answered her phone and so contractors could not reach her. And still, they wouldn’t hire me as a permanent employee.

It then became apparent that the married vice-president was sleeping with her.
I saw the situation as hopeless and gave 2 weeks notice after accepting another assignment. They implored that i stay (as a temp of course) and at least if i was leaving, to give this 22 y/o human resource manager all the info i had in order to bring her “up to speed”. ROFL. Not happening.
8 months later i find out that the company had to close that office due to their inability to meet contractual obligations to bring on much needed employee contractors for their clients. A responsibility that she held along with another co-worker. So they lost their clients, contracts you name it.

Case in point–hiring younger workers is not always the best bet. In fact, it can be more detrimental to hire inexperienced, unmotivated younger workers simply because an employer thinks they have more “staying power”.
In the end, her incompetence and her vice-president’s inability to think with his brain instead of his Pen*s sank the whole boat and everyone lost their jobs.

Only she was able to get another one rather quickly due to her age, her looks and having held a “HR manager” position, while her other 35+ year old co-workers were still looking for employment a year later.
I was so glad i left when i did. It didn’t take a genius to see that accident waiting to happen.

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Andy August 10, 2012 at 2:32 pm

WOW! I clung onto every word, not that this has happened to me but I am in my late 40s now so I can relate. Experience out weighs the youth period. I tried to get an older gentlemen to fill a position at my branch and corporate management decided against my better judgement to bring in a younger inexperienced worker. Not only does she not know what she’s doing she also has 1/2 the motivational level of someone 20 – 30 years her senior.

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Thomas Mrak August 3, 2013 at 10:10 pm

I listened to your story. It is indeed deplorable, however I would not write off younger people quite yet.

Ideally, it would be best for younger and older employees/management to learn from each other.

An older person does have more experience and has seen a lot change over the years.

A younger person doesn’t have the experience yet, but a younger person tends to be more open due to not having enough experience to know “what works” yet.

The main reason some companies don’t want older workers isn’t the age itself. It’s the fact they don’t want to pay someone who is experienced, and they honestly do believe experienced/highly educated people will leave the first opportunity they can get.

This may have been true at one point, but with how competitive things are, people tend to take what they can get and stick it out.

Younger people are more willing to work for less and money and less benefits than an older person.

For some companies saving a few dollars is more important than whether or not someone is competent and whether or not the company will be in business long enough for people to retire.

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RealityCheckGirl April 21, 2012 at 2:00 pm

So basically, i am 46 now and I am not planning on ever leaving the workforce. I may retire from full-time work and take social security but i will be working part-time until i am at least 76. Unless my health deteriorates.

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njmom101 July 6, 2012 at 12:11 pm

We are all forgetting one last very important tip. TEACH OUR CHILDREN HOW TO SAVE! I truly believe that most of us did not get good advice from our parents on how to save or manage funds properly or the truth about credit and debt. We need to end the cycle of ignorance and set our children on the right paths so that they can live better than we did!

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Jim September 19, 2012 at 6:53 am

I’m 46 and have no retirement plan yet! I do own my house and 118 acres of land, all paid for. Does anyone know what I should do to get a retirement plan so I can retire at 70?

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Kat Fud December 30, 2012 at 5:06 pm

Yep. Rent your acreage if you’re not planning on farming it yourself. You have to pay property taxes on it anyway, you may as well see if you can get it to make you some money.

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John October 25, 2012 at 12:53 pm

I am a small biz owner. I lost everything I owned with the economic downturn. I had 3 homes, 2 of which were rentals. My business dropped off about 33% and I couldnt keep up with payments. I drained my savings, and used everything to save my business. Now I make a meager salary, live in a tiny 1 BR apartment and have no savings.

Even with an MBA in Finance and Accounting, almost 10 years of business experience, no company wants me because I am in my late 40s and a white male.

Recruiters just put their heads down and pretend I am not there when I meet them. Everyone else says I am overqualified. I’m in the black hole of the late 40s early 50s. My only hope is to die young.

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Lifeisdynamic October 25, 2012 at 3:16 pm

Hello John,

Saddened to read your story. All may not be lost, it is just difficult to see opportunities while you are low.

Have you thought about consultancy as a business mentor – you have done the hard yards and learned lessons along the way. Choose your clients wisely – those with good ideas that will go the distance with your help.

Mentoring could not only bring in some money, but re-establish a small business, get you out there with people, improve your confidence and get you networking again for other opportunities.

Good luck,
Judith

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Emily Guy Birken October 25, 2012 at 2:10 pm

@John, I’m so sorry that happened to you. I’m sure things will pick up. Can you contact your alma mater to talk to other alums in your field? I know that my college is very diligent about keeping us in touch with each other and some old contacts from college might be very useful to you.

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angel June 13, 2013 at 9:55 pm

I am 42 and my husband is 43 we have a 13 yr old we hardly ever get support for and a 11yr old we pay 500 a month for plus medical for both. How on earth can I save any money every time I get alittle saved say 1,200-1,500 something comes up and takes it all. we drive a 20 yr old car have no credit and rent. at the end of bills and food there is nothing left. pay check to pay check and some times the food bank. I have a two yr in marketing management and he has self taught computer skills and works for a company from home. we make less then 40,000 a year. 6,000 alone goes for child support. I am so lost I don’t even know how to pick up the pieces to fix it. I was a single mom for the last 12 yrs and still have never been able to save more then 1,500 and then have to fix a car or pay something. behind on medical bills every where. and most pay checks beyond bills can hardly keep food on our table. I have already told our grown kids that they are going to have to take care of us some day cause there is no way we can save anything. broken In Missouri

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Anthony December 9, 2013 at 6:48 am

I am 57 with no money, savings, or retirement account. I felt called to Christian ministry in my 20’s so I didn’t focus on a career. Long story short, sickness – illness, -home loss, -and a handicapped child took all my resources. I am not angry bit the rest of my life is in God’s hands now. Please pray for me.

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Tuesday May 3, 2014 at 11:54 pm

Anthony ~ My heart breaks and my eyes well with tears reading your story. Our story is similar and we live on the edge too. I did just spend some time in prayer for you. For ourselves, we are hanging on to believing God has us in his hands even when it feels like we’ve been dropped. I still believe he has us — and you.

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Natilya James January 27, 2014 at 1:31 am

It is always better to set your retirement planning target. Before you choose your pension plan, you should estimate that how much money you would need to maintain your lifestyle once you are retired from your job. Also, you must try to convert at least seventy per cent of your pension funds to income.

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Cherion October 19, 2014 at 3:05 pm

To those who say they can’t find any money to save I say you can if you just start looking even if its small. Lets say you find a cheaper cell phone company that cuts your bill by $10 to $15 and you start putting that in an account. It seems insignificant at first but it gets the ball going. Once you do that you do start to think of other ways you can put money aside. I myself didn’t start until close to age 48. I had nothing and a lot of debt. I’m now close to 56 and I have saved $50,000 and cut my debt back. This even after I had $8,000 in medical bills to pay since 2012 and almost paid. ING offered me $50.00 to open an account and that is how I started. I even put change in a cup and put into savings every 6 months. Any unexpected money like a tax return I put into savings. Took out some CD’s which earns some interest. You can do it even it starting small. Make one of your bills to pay yourself such as $50.00 a month and if you cut other expenses it adds up to more than $50.00. Work extra hours or get part-time work and use that money for retirement account.

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