Zero Retirement Savings? Don’t Panic — Do These 4 Things Now

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If you’ve tried hard to reach your financial goals and outline your retirement plan but your savings account is still at $0, it can be scary. Don’t be too hard on yourself, though — it’s never too late to kickstart your retirement fund.

Between rising costs, economic instability, credit card bills and student loan debt, it’s no wonder that many people are struggling to make ends meet, let alone reach their retirement goals. But the good news is there are still plenty of ways to start building a nest egg for your golden years.

Regardless of your age, check out these expert money tips to help you begin your journey from $0 to a much more comfortable retirement amount.

Boost Your Income

Living paycheck to paycheck can feel suffocating when you are just trying to cover your monthly expenses. Building an emergency fund or saving for retirement may seem impossible, but it’s crucial to remember that you can change your financial trajectory by increasing your income.

Focus on increasing your income by paying off your debt first. Whether it involves searching for a higher-paying job, starting a side gig or enhancing your salary by asking for a raise, these are all potentially pivotal steps toward creating room in your budget for retirement savings.

Embrace Budgeting

Effective budgeting is a fundamental strategy for freeing up resources to allocate toward retirement savings. By scrutinizing your income and expenditures, you can identify areas where you can cut back on non-essentials and redirect those funds toward your tax-free retirement nest egg.

Start by keeping a strict budget until deeply ingrained spending and saving habits are formed. You can automatically transfer percentages of your paycheck to your Roth IRA or high-yield savings account. Tracking your spending can be as simple as getting a budgeting app or only buying the items on your grocery list without impulse purchases.

Harness the Power of a 401(k)

Any financial advisor will tell you that if you haven’t started saving for retirement, taking advantage of a 401(k) with employer matching is essential to accelerating your savings. If you are not doing so, you are essentially leaving money on the table. 

By contributing at least the minimum percentage to obtain the entire employer match, you basically get a 100% return on your savings. Plus, this money will come out of your paycheck directly without you having a chance to spend it.

Automate Your Savings 

If you tend to be an impulsive spender and struggle with saving money, automating your retirement savings can be a game-changer. A great way to increase savings is to create automatic ACH drafts from your checking to your savings after your paycheck hits your bank account.

For example, you could break your paycheck into percentages and try the 50/30/20 budgeting rule. This is where you would allocate 50% of your money toward needs, 30% to wants and then automatically transfer 20% into your savings account, preferably one with a high interest rate.

Final Take To GO: What If You Start Saving for Retirement Late?

The bottom line is that even if you find yourself in your 40s or 50s with no retirement savings to your name, it’s not too late. While it may require extra effort and lifestyle adjustments, the journey to secure retirement funding remains possible.

If you are middle-aged and don’t have any savings despite working steadily in your 20s and 30s, then it likely means you overconsumed and will now need to under-consume. It may be hard at first, but by making a few frugal adjustments, you can certainly boost your retirement fund.

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