I am a woman in my late 50's, working full time but I am just meeting bills. How can I build reitrement?

Question

I work for a non-profile foundation. My income is low for my area. I feel it is too late to start a new job at my age to where I can build income or retirement. I just make my bills as it is. My health is slowing and I need to find a means to retire. I do not have any money to invest (lost my 30 yr marrage and came out with nothing so I'm starting all over.

Answer 1

You have NO choice. You MUST find money to invest. You are very late to the party so you will need to reallly make this a priority.

How? Here's some ideas:
1. Find another job that pays more.
2. Take a second part-time job.
3. Sell things on eBay in the evening.
4. Take in a roommate.
5. Invest in your employer's retirement plan (which should be pre-tax investments so it won't impact your spendable cash as much).
6. If your employer does not have a plan, get another job. A good employer plan matches a percentage of your investment so you get twice as much growing for you. An excellent plan (less common) puts money in even if you don't.

I know this sounds harsh but the scary reality is that a majority of women over 64 in the US live in poverty because they don't have money put aside for retirement.

You will need to take advantage of the catch up provisions that allow investors over 50 to make larger contributions to their IRA accounts.

Between your employer plan (invest at least as much as they will match funds if they do that) and a Roth IRA, you should plan to put aside 15% or more of your income each year.

On the plus side, if you have more than 10 years of work history, you should get social security and medicaid, presuming of course that the system doesn't go bankrupt. It won't be enough savings, but it is a good start.

Once you get aggressive about saving and/or working to earn more so you can save, it will get easier.

Let me give you an example here:
If you can invest $3500 a year in a ROTH IRA (which will give you tax FREE money at retirement) this year and every year afterwards from now until you are 65 (15 years) AND you have it in a nice balanced mutual fund that averages 7% a year (a fair assumption), you will have almost $104,000 in that account when you are 65.

That should help. Keep in mind you will want to put more aside, but that would be a great start.

Best of luck.

Answer 2

If your company doesn't have a retirement plan, see if they can get one. The money comes out before taxes, and it won't hurt your net pay as much. If they don't, check into opening an IRA. Some are tax deductible but not until the end of the year. You may want to open an IRA that does not allow you to take a tax deduction when it pays out you won't have to pay taxes on it. Otherwise you will pay takes when you receive any money from a tax deferred account. Talk to someone at your local bank. It has been a few years since I have worked in a bank and as a financial adviser. The laws may have changed. Good Luck.

Answer 3

The answer above is an EXCELLENT answer :) Everything I was going to say and more!!! The only thing I can add to what Lori has laid out so well, is the fact that you were married for 30 yrs to your husband which means you are entitled to his social security benefits I believe. I remember reading something about this a while ago so you will want to speak to a qualified representative of the Social Security Administration. That helps of course, but as Lori said, SAVE SAVE AND SAVE SOME MORE!!! You've got a lot of ground to cover! Good luck!

Answer 4

Whipping out the calculator right after dinner is NOT conducive to the evening's taking a romantic turn. However, after two people have been dating for a while, the lady is expected to occasionally produce a pair of theater tickets, "just happen" to have a gift card for a favorite restaurant, and to say thank you with useful gifts. If their incomes and expenses are about the same, then she should be aiming to make contributions in the 50% neighborhood.

Answer 5

What is the least essential thing you spend money on?

Do you smoke?

qUIT AND SAVE THE MONEY YOU WERE SPENDING ON THE HABIT. That's a double bene.

Do you have cable tv? Cancel and go to the library and borrow movies instead. I am amazed folks still RENT movies when the library has them for free.

Do you eat at fast food resuraunts? Instead of spending $7 on crap, buy a bag of salad for 1.99 and save the 5...

Do you go to star bucks? If you do that once a week, that's 250 a year you could be saving.

Scrimp and save. I am sure there is fat to cut.

Answer 6

Shop at the dollar store and stop worrying about retirement. SS will help you some. Retirement is overrated. People work so hard, save all this money and die. What a waste. You'll be fine. Dump any expensive habits and cut overhead. Die with no money. You can't take it with you, so don't worry about it.

Answer 7

I can help you. I offer free advice to people in your position. You can increase your net income and improve your health and find yourself on top of the world emotionally. Its all about finding the right new path for your life. Write to Bruce @ [e-mail]

You have everything to gain!

Answer 8

Did your ex have retirement or a pension? You are legally entitled to part of that, don't just roll over and kiss that off because you don't want to deal with him anymore--this is about you and your future.