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Ask an Advisor: I’m 63, Have No Retirement Savings and Will Rely on Social Security. How Do I Begin Saving? Is It Too Late to Start Investing ‘This Late in the Game’?


I’m 63 and have zero retirement, just Social Security benefits. How can I begin saving? And where can I begin investing this late in the game?


Saving for retirement is certainly easier and has a greater impact on you the earlier you begin, which you seem to understand. The longer you wait, the less time you have to put aside money. Additionally, the compounding effects from interest, dividends and growth have less time to work for you.

Regardless of how late you start, however, I don’t like the idea of broadly classifying it as being “too late.” I worry that if someone thinks it is simply too late to start saving for retirement, it’s easy to slide into the thought that it isn’t worth planning at all. That part isn’t true and believing it will leave you worse off.

Yes, you need to be realistic about your retirement expectations such as when you can afford to retire or the type of lifestyle you’ll be able to maintain. But that doesn’t mean there isn’t anything you can do to make your retirement better.

financial advisor may help you identify and understand retirement income strategies.

Start Saving

Start saving to plan for retirement.

If someone starts saving at 63, it’s a pretty safe bet that they should be saving everything they reasonably can. I can’t say how much that is for you because I don’t know you or your situation, but give some serious thought to what that amount would be. You still need to eat, pay your bills and have a life. But come up with an amount that you can put aside and commit to it.

An added benefit of going through this exercise is that you may find ways to cut expenses from your budget. If you can get used to living on a smaller budget before you retire, it will make your transition easier and more financially viable.

Are you likely to amass a large savings balance by the time you retire? No, but it will be more than the $0 you have saved now. I’ll give you an example. Let’s just assume that you’ll max out an individual retirement account (IRA) each year. That’s $7,000 per year since you qualify for the 50 and older catch-up contribution. Let’s say you work until you are 70 and ignore the potential maximum contribution limit increases.

Over the next seven years, you’ll have saved $49,000. Depending on how you invest and the rate of growth on those investments, your account could grow beyond that. For example, at an annual growth rate of 3%, your final balance could reach $53,637. With a higher annual growth rate of 9%, your balance could reach $64,403.

Are any of those amounts enough to send you on a European river cruise every year? No. Would having that much money accessible to you provide you with an additional layer of security? Yes.

So no, it isn’t too late to start.

Plan for Other Income

Regardless of what you commit to saving now, it is unlikely that your savings alone will support you. I don’t say that to be discouraging. In fact, I say that so you don’t get distracted by it or become frustrated with your progress and give up. Instead, view any amount of savings you accumulate going forward as an improvement from your current situation.

Next, think about the other sources of income you might have in retirement.

Calculate Social Security

Let’s start with Social Security because the odds are that you are covered, and if you are, it will be the biggest source of income you have once you retire. You need to make the most of it. That may mean waiting for as long as you can to file, so you can take advantage of the delayed credits.

Here is how that works:

For each full year past your normal retirement age that you wait before claiming, up to age 70, your monthly check goes up by 8%. It sounds like you were born in 1959. If so, your normal retirement age is 66 and 10 months, and if you wait until 70 to claim you’d get an extra 25.3%. On top of that, your Social Security benefit offers some protection from inflation because of the annual cost of living adjustment.

While I certainly think there’s a lot to be gained by waiting, and you should strongly consider it, don’t just assume that you should wait until 70 and certainly don’t make that decision based on what I’ve said here alone. Current financial needs, health concerns or your family history may provide ample reason to file before then. The point I want to make here is that Social Security is likely a very important component of your retirement, and you should give considerable thought to your filing strategy.

Consider Part-Time Work

Consider part-time work in retirement.

If you are able, planning to have a nontraditional retirement may be something you want to consider as well. Income from part-time work coupled with your Social Security benefit could be all you need to live comfortably. It will certainly make your savings go further.

More retirees are opting for this type of arrangement than have in previous generations. Often, it’s not even for financial reasons but to have social interaction and a sense of purpose.

What to Do Next

Be realistic about what starting now means for your retirement lifestyle and consider these options for funding retirement.

Brandon Renfro, CFP®, is a SmartAsset financial planning columnist and answers reader questions on personal finance and tax topics. Got a question you’d like answered? Email and your question may be answered in a future column.

Please note that Brandon is not a participant in the SmartAdvisor Match platform.

Investing and Retirement Planning Tips

  • If you have questions specific to your investing and retirement situation, a financial advisor can help. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • As you plan for income in retirement, keep an eye on Social Security. Use SmartAsset’s Social Security calculator to get an idea of what your benefits could look like in retirement.

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