Is 50 Years Old Too Late to Start Saving for Retirement?

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If you are 50 and haven't saved anything for retirement yet, you're undoubtedly in a frightening place. You're only a decade and change away from giving up work and seeing an end to your paychecks and you don't have a financial cushion to fall back on.

The big question you're probably asking right now is whether all hope is lost and whether 50 is really too old to start saving for your later years. The good news is that, in most cases, it's not -- especially if you're willing to buckle down and get serious about funneling funds to your brokerage account or 401(k) plan.

Starting to save earlier is always better

First things first. It's always better to start saving for retirement sooner rather than later. The sooner you start, the more time you have to make contributions and the more time those contributions have to grow. Starting a decade earlier gives you the chance to put compound interest to work for you in powerful ways.

To understand how important early saving is, look at the table below. It shows how much you'd have to invest monthly to end up with $500,000 saved by age 67 -- but based on different ages when you got started, assuming a 10% average annual return.

There's a huge jump up here once you get to age 50 because you have so little time left for your investments to earn returns that are reinvested and work for you to grow your money. Without help from your growing investments, you have to put much more money into your retirement plan.

It's never too late to start saving

Now, if you're looking at that table, you can see that it would have been better to start earlier. But you can't invent a time machine (and if you could, you probably wouldn't have to worry about retirement savings anymore).

While you'll have to work harder now, it's never too late to get serious about becoming more financially secure as a senior. The best time to get started was decades ago, but the second best time is right now, today, so you don't lose any more time.

With just a few short years to retirement, you'll need to do a few things to try to get back on track. Here are your best moves.

Make a plan to work for as long as possible

The longer you stay at work, the longer you can delay claiming Social Security. Waiting until 70 raises the monthly income you get to the maximum amount possible. Your standard benefit could be as much as 24% higher at 70. You can also keep contributing to your 401(k) as you work into retirement, so your retirement savings balance will continue to grow.

Make a plan to save as aggressively as possible

Since you have some catching up to do, you're going to have to save a lot each month. Aim to do that by increasing your income when possible. Work overtime or take a side job solely to find extra funds to save for retirement.

Scale down expectations

You may not be able to live in the most expensive city in the U.S. if you've saved very little or nothing for retirement by age 50. But you can still have a comfortable life in a lower cost-of-living area -- especially if you're able to downsize your home to buy a cheaper one and doing so gives you some extra cash to invest .

Don't wait another day if you're 50 and starting to worry about retirement savings. Take action today to start contributing to your account and avoid going broke in your golden years.

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