Is It Ever Too Late to Start Saving for Retirement at Age 60?

If you feel like there isn’t much time left to save, you’re not alone. However, there are ways to help, like making use of workplace benefits, raising the percentage of money you save, and more.

Your retirement funds have more time to grow if you start saving early. That implies that in order to reach your financial objectives later, you need to save less money now.

However, many believe that there is not enough time left for them to save. According to the most recent Quarterly Market Perceptions Study* from Allianz Life Insurance Company of North America, 66% of Americans worry that if they don’t increase their retirement savings soon, it will be too late for them to have a comfortable retirement. This is up from 61% last year.

Many people believe that starting to save for retirement at age 60 is too late. However, this is not necessarily the case. While it is true that the earlier you start saving, the more time your money has to grow, it is never too late to start. In fact, even if you are starting from scratch, there are still things you can do to increase your chances of having a comfortable retirement.

Tips for Starting to Save for Retirement at Age 60

Here are a few tips for starting to save for retirement at age 60:

  • Take advantage of all benefits through your employer. Your employer likely has benefits to encourage you to save for retirement. Many employers offer to match contributions employees make to their 401(k) plans. A simple step to increase your savings is to make sure you are contributing enough to get the full match. Not contributing enough to get the full match is leaving free money behind! Some employers also offer programs to help employees receive matching funds without hitting the contribution threshold. For example, starting in 2024, a provision in the SECURE 2.0 Act will allow for employers to match contributions to retirement savings for the amount employees pay back in student loans.
  • Increase savings by 1%. The best way to have more in savings is to, well, save more. A good strategy is to increase your contributions to retirement savings accounts by 1 percentage point every year. Over time, this increase to your savings will add up, but it won’t feel like a major bite out of your budget.
  • Convert savings into a Roth IRA. If you’re worried about having enough saved for retirement, you’ll want to find ways to mitigate risks like taxes. One way to control taxes is to convert savings into a Roth IRA. A large portion of retirement savings is done in tax-deferred accounts like a 401(k) or IRA. But taxes are inevitable. Taxes will be due when you start withdrawing from those accounts to fund your retirement. Converting those funds into a Roth account and paying taxes now can help lower your taxes and increase your retirement nest egg. Considering a Roth IRA Conversion? Six Reasons It Makes Sense Please remember that converting an employer plan account to a Roth IRA is a taxable event. Increased taxable income from the Roth IRA conversion may have several consequences, including (but not limited to) a need for additional tax withholding or estimated tax payments, the loss of certain tax deductions and credits and higher taxes on Social Security benefits and higher Medicare premiums. Be sure to consult with a qualified tax adviser before making any decisions regarding your IRA. This conversion can be done in various ways. Some choose to convert to an entire IRA all at once or spread it out over years. It may also make sense to perform conversions over multiple tax years to avoid entering a higher tax bracket. Also, if your employer offers a Roth 401(k) or other Roth options, take advantage of that for possible tax-free withdrawals later on. SECURE 2.0 now allows employers to match Roth contributions in Roth plans as well.
  • Consider where you will retire. Your take-home retirement income will vary based on where you live. If you worry about stretching your savings, living in a low-tax state could help. Eight states in the United States have no income taxes — Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming. These states don’t tax wages, salaries, dividends, interest or any sort of income, including Social Security benefits. (New Hampshire also doesn’t tax wages and salaries and will stop taxing interest and dividends in 2027.)
  • Make catch-up contributions. If you are 50 or older, the IRS allows you to contribute additional money to 401(k) and IRAs above the standard limit. This can help increase your savings in tax-advantaged accounts. Total 401(k) contributions are capped at $66,000 in 2023 (this includes contributions made by an employee and the employer). Another $7,500 in contributions are allowed for people over 50. That brings total 401(k) contributions with catch-ups to $73,500 in 2023. For IRAs, people over 50 can make $1,000 in IRA catch-up contributions every year for a total contribution of $7,500 in 2023. Starting in 2024, there will be an increase in the limit on catch-up contributions for people age 60 to 63 that will be the greater of $5,000 or 150% of the regular catch-up amount in 2025. Many people are often in their highest-earning years toward the end of their careers and may have more money to set aside for retirement. Making catch-up contributions can help make up for lower savings rates in your younger years.

Additional Tips for Saving for Retirement at Age 60

  • Downsize your home. If you own a large home, consider downsizing to a smaller one. This will free up some money that you can use to invest in your retirement.
  • Sell your car. If you have a car that you don’t use very often, consider selling it and using the money to invest in your retirement.
  • Get a part-time job. If you are retired or semi-retired, consider getting a part-time job to supplement your income.
  • Invest in dividend-paying stocks. Dividend-paying stocks can provide you with a steady stream of income in retirement.
  • Be patient. It takes time to build a retirement nest egg. Don’t get discouraged if you don’t see results immediately. Just keep saving and investing, and you will eventually reach your goals.

It is never too late to start saving for retirement. Even if you are starting from scratch at age 60, there are still things you can do to increase your chances of having a comfortable retirement. By following the tips above, you can start saving for retirement today and make sure you have enough money to live comfortably in your golden years.

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Millennials and Gen X in particular are beginning to notice that retirement is drawing near. While Millennials and Gen Xers expressed concern about needing to save more money soon for a comfortable retirement, Baby Boomers expressed the same concerns about the same thing.

Your retirement is at risk if you don’t save enough money: you could end up without any comforts or, worse yet, broke. One of the biggest concerns that many people have about retirement is this risk. Unless you have already retired, it is never truly too late for you to start saving more and making retirement plans. Here are five strategies to increase your retirement fund right now.

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is it too late to save for retirement at age 60

60 Years Old and Nothing Saved for Retirement – Top 12 Recommendations


Is 60 too late to start saving for retirement?

We want you to hear us say this: It’s never too late to get started saving for retirement. No matter how old you are or how much (or how little) you have saved so far, there’s always something you can do. You can’t change the past, but you can still change your future.

What to do if you are 60 and have no retirement savings?

If you retire with no money, you’ll have to consider ways to create income to pay your living expenses. That might include applying for Social Security retirement benefits, getting a reverse mortgage if you own a home, or starting a side hustle or part-time job to generate a steady paycheck.

How much should you have saved to retire at age 60?

And by age 60, you should have six to 11 times your salary saved in order to be considered on track for retirement. For example, a 35-year-old earning $60,000 would be on track if she’s saved about $60,000 to $90,000.

What is the $1000 a month rule for retirement?

One example is the $1,000/month rule. Created by Wes Moss, a Certified Financial Planner, this strategy helps individuals visualize how much savings they should have in retirement. According to Moss, you should plan to have $240,000 saved for every $1,000 of disposable income in retirement.

Is it too late to start saving for retirement?

You can use the time to start saving and prepare for retirement expenses. “It may seem trite, but it’s never too late to start saving for retirement,” says John Stoj, founder of Verbatim Financial in Atlanta. Some people may find it hard to save during significant stages of life, such as purchasing a home and putting kids through college.

When should you start saving for retirement?

Except, it says that you should have started saving for retirement in your 20s. You’re well past that age and still haven’t even started saving for retirement. Fortunately, you do have options, even if you’re getting a late start. Maximize your annual retirement savings. Set a reasonable dollar goal. Avoid unreasonable risk.

Is it too late to start saving?

Any investments you make won’t have many years to earn interest. You might need to access your savings soon after retirement. As you question if it’s too late to start saving, think about: How close you are to retirement. When you want to take Social Security. What you will need to be comfortable. How saving in your 50s and 60s could work.

How much money can a 62-year-old retire a month?

For example, a 62-year-old retiring this year could receive a maximum monthly benefit of $1,992, but a 70-year-old retiring this year could receive $3,425 a month. If Mr. and Mrs. C. can max out their retirement savings options, they could have more than $250,000 set aside for retirement by the time Mr. C turns 70.

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