5 Retirement Planning Moves for Late Starters

When you’re trying to build your nest egg, it’s best to start setting money aside as soon as possible. The longer you put it off, the less time your assets have to grow. If you wait too long, you risk not having enough cash to see you through your golden years. Getting a late start isn’t ideal, but it’s still possible to build a comfortable retirement if you’re savvy about planning. Here are a few tips to get your financial future on the right track when you’re behind the eight ball.

Consider finding a financial advisor to help you follow through on all of these tips.

1. Estimate What You’ll Need

If you’re getting a later start on retirement planning, the first step is understanding what retirement might look like for you. Consider factors such as when you hope to retire, where you plan to live and how you expect to spend your time. These lifestyle choices play a major role in determining how much income you’ll need.

Estimating retirement needs begins with identifying essential expenses, including housing, food, transportation and health care. Health care costs, in particular, can rise significantly later in life and should not be underestimated. Having a clear picture of baseline expenses creates a foundation for more accurate planning.

Next, consider what income sources you expect to have in retirement. This may include Social Security, pensions, part-time work or rental income. Understanding how much income these sources may provide helps clarify how much your savings will need to cover.

Inflation and longevity risk can have a substantial impact on retirement needs, especially for late starters. Planning for a retirement that lasts 20 or 30 years requires building in a margin for rising costs over time. Factoring in these realities can help prevent underestimating how much you’ll need to save.

2. Look at Your Savings Options

A man calculating a retirement planning strategy for his nest egg.

There are lots of ways to fund your retirement and it’s easy to feel overwhelmed if you’re just getting started. Participating in an employer-sponsored plan, such as a 401(k) or 403(b), is one of the easiest ways to save, especially if your company offers matching contributions.

If you’re not eligible to participate in a plan through your company, you can always chip in money to a traditional or Roth IRA. Traditional IRAs offer tax-deductible contributions while Roth IRAs give you a tax break when it’s time to start making withdrawals. Self-employed individuals and small business owners also have additional options in the form of a SEP or SIMPLE IRA.

3. Know Your Limits

The IRS has different guidelines concerning how much you can put into each type of retirement account every year. It’s important to know what the limits are to make sure you’re maxing out your plan. For tax year 2026, the most you could put into an employer-sponsored plan is $24,500. For tax year 2025, the limit was $23,500.

The limits for a traditional or Roth IRA are much lower, at just $7,000 for 2025, and $7,500 in 2026. The limit for a SIMPLE IRA is $17,000 in 2026, which is up from $16,500 in 2025. However, if you have a SEP IRA, you can put in a little more. Currently, the IRS allows you to sock away 25% of your net self-employment income, up to a max of $72,000 for 2026, which is $2,000 more from 2025.

4. Take Advantage of Catch-Up Contributions

A couple reviewing their catch-up contributions.

If you’re older than age 50, you may be feeling even more pressure to ramp up your retirement savings. Fortunately, you may be able to make catch-up contributions to your retirement fund, depending on the type of account you have. For the tax year 2026, you’re allowed to save an additional $1,100 in your traditional or Roth IRA, which is up from $1,000 in 2025.

The catch-up contribution limit for 401(k) plans, 403(b) accounts or a 457(b) is $7,500 in 2025 and $8,000 in 2026. However, if you’re between the ages of 60 and 63, your catch-up contribution goes up to $11,250 instead of $7,500.

You were also able to put an extra $3,500 in your SIMPLE plan in tax year 2025 and $4,000 for 2026. And employees aged 60 to 63 in 2025 have an even higher catch-up contribution limit of $5,250.

There are no catch-up contributions allowed for a SEP IRA.

Cut Costs Now

The closer you are to retirement, the more important it is to start getting your financial ducks in a row. Minimizing your expenses will free up additional cash that you can squirrel away in savings. It can give you some breathing room if you’re expecting your income to drop once you retire. While you may not need to do something as drastic as sell your home, getting rid of high-interest debt and looking for ways to save on your everyday bills can make a big difference in how long your nest egg will last.

Retirement Planning Tips

This might be a good time to talk to a professional financial expert about your money matters. A financial advisor can help you determine how to maximize your retirement savings as you play catch up. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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