A senior woman using her credit card holding her cell phone in the living room of the house

Key takeaways

  • Even if you feel you are behind in savings and your retirement is looking closer and closer, keeping a level head and planning can help put you on the right path.
  • Many tax-advantaged retirement savings accounts allow catch-up contributions for people 50 and over.
  • Make sure that you are adequately insured to prepare for the unique financial circumstances following retirement.
  • Think of tapping other sources of income and equity to supplement your savings and earnings.

How much have you saved for retirement? If you’re nearing your projected retirement date, and you don’t think you have enough in savings to maintain your current or desired lifestyle, here are a few things you may be able to do to get yourself into a better position.

Keep calm and take stock of what you have

The first step is to take a deep breath and remember that you may be able to better cope with problems with a little smart planning.

The second step is to sit down with your finances and figure out how much money you will need to live the life you want in retirement. There are many helpful tools out there: articles, calculators and financial advice from professionals. Before you’re ready to start making calculations, however, you may want to review the following items.

How much have you saved, and what income will you have?

Do you have retirement accounts, taxable brokerage accounts or other general savings? Do you have a pension through your workplace? Have you calculated your Social Security benefit? Are you married, single or divorced?

Not working doesn’t just mean losing a paycheck from your employer – it also may mean more unstructured time and new sources of income with different tax treatments than you may have become accustomed to during your working years, among other things. How you fill your time and how you manage these new income sources are important considerations when you budget for retirement.

In addition to drawing down savings and receiving payments from pensions, annuities and Social Security, a growing number of people are working in semi-retirement1 and developing portfolios that produce passive income.2 If you have other sources of income and are able to do so, waiting to claim Social Security until age 70 may allow you to maximize benefits over your lifetime.

Understanding your current financial picture and planning for benefits, like Social Security and pensions, are important steps to figuring out how much income you may have in retirement.

How much do you plan to spend in retirement?

Even if you expect the bulk of your spending to stay the same after you retire, take some time to list your goals and related expenses. Understand whether your current financial strategy can cover it all, or if you might need to reassess your spending and prioritize some goals over others.

Take advantage of catch-ups for older workers

Understandably, some earners had other, more pressing expenses in their 30s and 40s, like paying for a house and the high cost of raising children. But in your 50s and early 60s you may have extra money to put toward retirement.

If you are 50 or over, you may be able to contribute more to your retirement accounts to “catch up” on retirement savings. Depending on the type of account and options available to you, catch-up contributions can be made on a pre-tax, tax-deductible or after-tax basis. Many full-time employees have 401(k) tax-advantaged retirement accounts through their employers, and you may also have a traditional IRA, a Roth IRA or a combination. If you are 55 or over and have not enrolled in Medicare, you may also be able to contribute more to your HSA. Each type of account has a contribution limit set by the IRS.3

To make an HSA contribution, you must have a qualifying high deductible health care plan (although some restrictions may apply). Contributions are tax-deductible and if made through an employer may be excluded from your gross income. It is worth noting that if you are younger than 65 years old, HSA distributions must be used for qualifying health care expenses in order to be taken without taxes and penalties. After age 65, distributions may be taken out without penalty for any reason (but you would need to pay taxes if the expense is not a qualifying medical expense).

Type of account
2023 contribution limit 2023 catch-up amount Total 2023 contribution
Employee contributions to
employer retirement plans (401(k), 403(b)4)
$22,500 $7,500 (50 and over) $30,000 (50 and over)
IRAs (traditional and Roth)
$6,500 $1,000 (50 and over) $7,500 (50 and over)
Health Savings Account (HSA)
$3,850 (self-only) $7,750 (families) $1,000 (starting the year you turn 55)

Self-only coverage: $4,800

Family coverage: $8,750

(Contributor must be 55 or older)

Note that the $6,500 limit for IRA contributions is for all the IRAs you have, both traditional and Roth. So, if you have one of each, you may be able to contribute $6,500 total ($3,250 to each, for example), or $7,500 with a catch-up contribution. Similarly, employee contributions to employer-sponsored qualified retirement plans are also subject to certain aggregation rules. Contribution limits for Roth IRAs start to phase out according to your filing status and income. Similarly, tax deductibility for traditional IRAs starts to phase based on your filing status, income and whether you are covered by a retirement plan at work.

Health Savings Account (HSA) eligibility depends on the type of health insurance you have.

If you are unsure if you are eligible or have questions related to the types of accounts mentioned above, check with your tax professional or financial advisor.

Make sure you have adequate insurance

In addition to making sure your life insurance is current, you may want to look into long-term care and disability insurance before you retire.

Health care is one of the largest expenses in retirement and the potential need for long-term care increases with age. Long-term care insurance can help defray the cost of end-of-life care, which the Alzheimer Association estimated to be $204,864 in 2019 for people without Alzheimer’s and $357,297 for people with Alzheimers.5 This insurance can be critical, especially if you hope to leave some of your retirement savings to heirs as an inheritance. Alternatively, you may need to rely on assistance from friends or family or reduce discretionary spending to cover these expenses in retirement.

Consider your home equity as part of the equation

If you have lived in your house for many years, it has probably appreciated in value, and you may not owe much or anything on your mortgage. If this is the case, adding your home to your retirement equation may be another option to consider.

On one hand, a home that is mostly or fully paid for means lower recurring monthly costs currently or in the near future. But it also means ongoing maintenance that you may not want to do yourself in your golden years. Downsizing to a smaller, less expensive home may free up cash currently locked in your home’s equity. If you plan to remain in your home, a home equity line of credit may be another option to fund certain expenses in retirement.

Review your options

No matter what your current financial situation, set aside some time to review your options. Planning for your unique situation may help you get closer to where you want to be, even if you don’t feel that you’re there yet. Consider talking to a financial advisor who can help you craft a roadmap to ease your stress as you plan to transition to your years in retirement.



Damir Cosic and C. Eugene Steuerle. “Is demand for older workers adjusting to an aging labor force?” (November 2021).


Center for Retirement Initiatives. “Is it possible to build a 21st-century personal pension?” (June 2022).


Internal Revenue Service. “COLA increases for dollar limitations on benefits and contributions.” (November 2022).


If the 403(b) plan allows, an employee may be able to make the same type of catch-up contributions as may be allowed by a 401(k) plan, and an employee who has worked for a qualified organization for 15 or more years may, if he or she meets certain requirements, be able to make additional contributions of up to $3,000 for up to 5 years. For more information go to IRS 403(b) website and see 15-year rule in Publication 571, Tax-Sheltered Annuity Plans (403(b) Plans) under Contributions.


Alzheimer’s Association. “2020 Alzheimer’s Disease facts and figures.” (2020). This figure includes the estimated cost of informal care, which is provided by unpaid family friends. Genworth Financial, an insurance company whose subsidiary CareScout provides long-term care insurance conducted a survey in 2021 of four different types of end-of-life care and their monthly median national costs: home health care providers ($5,052), adult day health care facilities ($1,690), licensed assisted living facilities ($4,500), certified and licensed nursing homes in a semi-private room ($7,908) and in a private room ($9,034), in Gencare, “Cost of Care Survey.” (November, 2021).

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