50 Going on 65
At what point is it too late to start saving for retirement? Are you already past the point of no return (literally?)
Rest assured, there are still steps you can take.
Catch Up Contributions
Three tomatoes are walking down the street — a papa tomato, a momma tomato, and a baby tomato. Baby tomato starts lagging behind. Papa tomato gets angry, goes over to the baby tomato, squishes him and says, ‘Ketchup!
If you’re 50 or older and a little, or a lot, behind in your retirement savings, you may be feeling a little “squished” yourself. With an average retirement age of 67, you’re only 17 years from retirement. While 17 years seems like a sufficient amount of time to correct any poor retirement savings decisions you’ve made, most people save for retirement over the course of 40+ years.
Catch-up contributions are a saving grace to those feeling the tug toward retirement. Anyone who will attain age 50 (or older) by the end of 2016 can make an annual catch-up contribution. What does this mean for you?
In 2016, the maximum catch-up contribution allowed in a 401(k) plan is $6,000. This is an additional deferral on top of the annual contribution limit of $18,000.
Review the 2016 contributions limits to see if you qualify.
Overall, if you’re 50 with no retirement savings yet, now is not the time panic. Now is the time to act.
Struggling to come up with a game plan? Email us! We’re here to help you move toward a more dignified retirement.