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Polling and research show a quiet crisis underway for retirees and people saving for retirement.
Almost half of working-age families in the U.S. have not saved any money in retirement accounts, according to the Economic Policy Institute.
Not all of this problem is within our control. But much of it is, which means that hard choices are ahead.
Following are 10 ways to get your plan back on track. Some require extreme changes, but if you’re worried about retirement, you may be ready. The sooner you start, the easier your job will be.
1. Crack the paralysis
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Paralysis is understandable: We’re living longer and being forced to assume more of the savings and investment burden, with little or no education on the subject or support.
“Nearly three-quarters of pre-retirees agree that they should be doing more to prepare for retirement, but four in ten say they simply don’t know what to do,” says Prudential Investments’ 2016 Retirement Preparedness Study.
Take this to heart: You don’t need to know what you are doing to get started. Start saving, keep saving, and learn as you go.
- “9 Tips to Ensure You’ll Have Enough to Retire”
- “5 Simple Ways to Invest Your Retirement Savings”
- “How to Get Started Investing When You Don’t Have Much Money”
2. Pick a number
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Set a savings goal. It may change later, but pick a number now to get going.
To fund a nest egg, many investment professionals suggest that people consider saving 10 to 12 times the amount of their last full year of income.
By that logic, if you expect to earn $60,000 in your last full year of work, you should make your goal $600,000 to $720,000. You may not get there, but you’ll be better prepared for retirement than you are now.
Learn more: “Ask Stacy: How Can I Know I’ll Have Enough to Retire?”
3. Postpone your Social Security payout
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If you can manage to postpone claiming your Social Security retirement benefits, you’ll get an even bigger monthly check once you do start receiving benefits.
For example, for retirees born from 1943 to 1954, the Social Security Administration considers “full retirement age” to be 66 years. But if such retirees until after they’re of full retirement age, their benefits will grow by 8 percent every year until age 70.
- “14 Ways to Maximize Your Social Security Checks”
- “The Danger of Working While Collecting Social Security”
4. Emancipate adult kids
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Sit down with grown children and tell them what you are facing.
It’s a tough conversation. But laying your financial cards on the table gives them information they may need to plan their lives. It also may let you get a sense of whether living with them or expecting any support from them in your old age is a possibility.
Also, if your retirement is in peril and you are helping your kids financially, you’ll have to stop. There are other good reasons for withdrawing your support besides your money woes: Supporting adult kids can undermine their self-sufficiency.
5. Think carefully about divorce
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Of course, you should not stay in a marriage defined by violence or deep, longstanding incompatibility. But if you’re on the fence, understand that getting divorced deeply wounds couples’ finances.
This is especially true for women because they earn less and often drop in and out of the work force for family reasons, contributing less to Social Security and retirement funds. But divorce affects men’s finances, too.
Divorcing at an older age can make it especially hard to recover. Think realistically about the financial implications for yourself, your children and your retirement.
Learn more: “10 Hazards of Divorcing When You’re Older”