50 and Behind on Savings?

TIPS: IT CAN BE OVERWHELMING, BUT AN EXPERT GIVES ADVICE ON HOW TO CATCH UP FAST

- Hardi Swart

A while back, I sat in a consultation with a couple. The husband had just turned 50, and his partner was a year or two younger. Their story was one I've heard many times: after 20 years in corporate jobs, they decided to take early pensions and start a business focusing on fast-food franchises. Unfortunately, the Covid pandemic, lockdowns, and some poor financial decisions forced them to sell the business at a loss.

With most of their life savings gone, they both had to return to their corporate professions. They knew they needed to act quickly to rebuild their financial future. Retirement was just around the corner, and they wanted a plan to catch up.

Here's what we did—and what you can do if you're in a similar position.

1. Take stock of where you are
The first step in catching up on savings is understanding your current financial situation:

> Assess your savings: Calculate what you've already saved in retirement accounts, investments, or other assets.

> Understand your expenses: Create a detailed budget to track essential and discretionary costs.

> Determine your shortfall: Compare how much you'll need for retirement to how much you currently have.

For this couple, this exercise provided a clear picture of the gap they needed to close.

It also gave us the foundation to set realistic and achievable goals.

2. Maximize retirement contributions