50-something and not saving for retirement? There are plenty of us

Posted on Posted in Financial Planning

A Wells Fargo report printed in the LA Times says 41% of people in their 50s are not saving for retirement in any 401(k), IRA or similar vehicle. At age 54, I’m squarely in the middle of this demographic and served as an example of the results. Over the last two years I’ve had to empty every account to rebuild after super storm Sandy and still have over $150,000 in high interest rate debt to repay before I can begin rebuilding my retirement accounts. I made the mistake of thinking that insurance reimbursements, SBA loan FEMA, state funds or commercial loans through mortgage refinance would be available. I was wrong on all accounts. So now I fall into this category of non-savers.

Now I figure that one of five things will happen, listed here in order of most preferred to least preferred: 1) the commercial lending market will eventually ease and I can refinance and pay off my business debt in a normal manner and then return to a “traditional” cash flow that includes retirement savings, 2) I’ll be financially strapped paying off this debt for at least another five years and another decade to rebuild retirement funds, 3) I’ll be able to sell or otherwise cash in on my business for retirement income in about 15 years at age 70 (an unknown at this point), 4) I’ll not live to retirement age so I won’t need to worry about it, or 5) I’ll not get to actually retire and will need to keep working until I need to become dependent on someone else (my kids). Laying it out like this serves as eye-opening reality check for me.

Before this, I never imagined that I’d have debt at this age or not be saving anything. I guess that I always presumed that people with healthy six digit incomes who weren’t saving simply weren’t trying hard enough. Now I know that is not true. But mine is just one story. What about the other millions in this situation? I’d like to read other people’s stories and learn how you plan to handle it.

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