Retirement planning is an inexact process that involves making the best estimate possible of future needs and taking actions to close the gap between desired income and anticipated resources. As discussed, you can combine various catch-up strategies for greater impact. Use Worksheet 13, below, to note the catch-up strategies you plan to use and the specifics of each action.

Worksheet 13: Retirement Catch-Up Planning Worksheet

A few precautions for late savers:
  • Don’t follow simplistic financial guidelines blindly. For example, a commonly heard suggestion is to put a percentage equal to 100% minus your age in stocks (for example, 100% – 45 = 55%). This may work for some people but may be too conservative for others who are trying to make up for lost time.
  • Don’t necessarily use your employer’s retirement plan choices as an asset allocation formula. A recent study by investment firm TIAA-CREF looked at investors who divided their money equally across the number of funds in their employers’ plans. An airline pilot’s retirement plan with five stock funds and one bond fund was compared with a university plan with one stock fund and four bond funds. Not surprisingly, the pilots allocated 75% of contributions to stocks versus 34% for the university employees. By contrast, the national average for stock contributions to an employer plan was 57%.

Action Steps
Now that you’ve identified the general retirement catch-up strategies you’d like to use, review the following list of action steps to identify the specific tasks necessary to get your plans underway. Put a check before the actions you plan to take to start making up for lost time. List any additional ideas in the blank spaces at the bottom of the worksheet.

Worksheet 14: Retirement Catch-Up Action Steps

Resources for Late Savers
In Books

  • Ernst & Young’s Retirement Planning Guide (2001, John Wiley & Sons)
  • Get a Life: You Don’t Need a Million to Retire Well by Ralph Warner (1996, Nolo Press)
  • Investing On A Shoestring by Barbara O’Neill (1999, Dearborn Financial Publishing, Inc.)
  • J.K. Lasser’s Winning With Your 403(b) by Pam Horowitz (2001, John Wiley & Sons)
  • Slash Your Debt: Save Money and Secure Your Future by Gerri Detweiler, Marc Eisenson, & Nancy Castleman (1999, Financial Literacy Center)
  • The Baby Boomer Financial Wake-Up Call by Kay R. Shirley (1999, Dearborn Financial Publishing, Inc.)
  • The Late-Start Investor by John F. Wasik (1998, Owl Books)
  • The New Retirementality by Mitch Anthony (2001, Dearborn Trade)
  • The Prosperous Retirement by Michael K. Stein (1998, EMSTCO Press)
  • The Retirement Catch-Up Guide by Ellen Hoffman (2000, Newmarket Press)

Web Sites