“I am 50 and haven't saved for retirement.” “I don’t know how to save for retirement in my 50s with no experience.” Sound familiar? Plenty of others may feel the same way, whether they have little or no retirement savings, or are simply looking for the best way to save for retirement in their 50s.

As a rule of thumb, financial experts say the average 50-year-old should have about eight times their annual salary saved. And many people have likely heard the adage that when it comes to retirement, the earlier you save, the better. 

Though those in their 50s generally won’t have as long of a time horizon as those saving for retirement in their 20s, their 30s, or their 40s, it’s certainly not too late, and it can be smart to begin saving or accelerate putting money away as soon as possible. Plus, workers age 50 and older are eligible to contribute more than younger investors to retirement accounts each year.

For those planning for retirement at 50 or later, here are five things to consider.

1. How much do you need in retirement?

Investors in their 50s do typically have a shorter time horizon, but it’s crucial to figure out when, exactly, one plans to retire and what they want that lifestyle to look like. Determining those details can help workers make decisions: Once they know how many years they have before they retire, they can plot how much they’ll need to save during that time to build a retirement fund that will last.

Retirement budgets are dependent on one’s pre-retirement standard of living. Experts say the average retiree needs about 80% of their pre-retirement income each year, though that percentage may be adjusted if investors live above or below their means. Tools like retirement calculators can also help provide a sense of the overall picture.

And while it’s advised that investors shouldn’t assume Social Security benefits will make up the majority of retirement income, they are one potential income stream for retirees. Social Security benefits are available as early as age 62, but payments are reduced for claiming before full retirement age, which is 67 for those born in 1960 and later. Retire later than full retirement age, and a worker is eligible to earn credits that can add up to as much as an additional 8% each year, up to age 70.

Side note: Try Titan’s free Retirement Calculator to project how much you'll need in retirement.

2. Can you maximize your investments with catch-up contributions?

Especially for those who haven’t begun a retirement fund or are short of their savings goals, maximizing contributions to all retirement accounts can help an investor get caught up. These tax-deferred retirement accounts include employer-sponsored traditional 401(k) plans as well as Roth IRAs and traditional IRAs. 

Each of these buckets comes with annual contribution limits: For most investors in 2022, the limit is $20,500 for 401(k) plans and a total of$6,500 for IRAs. 

Investors in their 50s can make catch-up contributions beyond these limits. These payments can start the calendar year that a worker turns 50, even if their birthday hasn’t come yet.

For 401(k)s, workers 50 or older can make an annual catch-up contribution of $6,500 in 2022, bringing their total limit to $27,000. For IRAs, it’s a total of an additional $1,000, making the limit for that bucket $7,000. These extended limits can help bridge the gap for those who didn’t save as much earlier in their careers.

3. Do you have too much debt?

It’s expected that much of an investor’s cash flow may go toward essentials like housing, transportation, and food—and experts also recommend putting money toward a savings account as well as building an emergency fund that would cover about six months of living expenses.

For some workers, paying off debt may also comprise a small or significant portion of monthly cash flow. Whether it’s paying off a mortgage, school for themselves or their kids, credit-card balances that carry over from month to month or auto loans, it all incurs interest, which can add up. Zeroing out those recurring debts can free up more cash each month to put toward retirement. 

Higher-interest debts are important places to pay down balances as quickly as possible. But paying off lower-rate loans, namely mortgages, can also be beneficial. Investors who want to reduce their monthly cash spend in retirement might consider prioritizing paying off their mortgages in their 50s, particularly if the interest rate is higher than very-low-risk investments like bonds.

4. Is lifestyle creep eating into your funds?

Workers in their 50s likely command higher salaries than they did earlier in their careers. But as paychecks get bigger, so too can expenses: kids, a bigger house, a second car, health-care costs, and more. Lifestyle creep is real, and it can happen so slowly that workers don’t realize they’re outspending their means. And some 50-somethings may not have been as focused on retirement in their younger years, instead thinking about nearer-term goals like vacations and kids’ college funds. 

But many experts say that for investors in their 50s, retirement savings should be the first priority after non-negotiable costs like housing. To maximize retirement account funds, including catch-up contributions, workers may need to pull back on discretionary spending like weekends away and dinners out to live within their means—or even a bit below their means in favor of contributing more to retirement.

5. Can you find other sources of income?

Investors who find themselves behind may consider taking on a side gig in their pre-retirement years to shore up savings. They might even consider working part-time in retirement—perhaps consulting in their field—to keep cash flow going.

If retirement account contributions including catch-ups are maxed out but an investor has discretionary income left over, they may also choose to invest in the stock market through a brokerage account, a professional investment team, or a robo-advisor. 

While results aren’t guaranteed, informed stock market investments may help workers generate passive income while staying ahead of inflation: The average stock market return was 13.9% annually during the past 10 years, while annual inflation rates have come in between 1% and 3%.

Investors can also select stocks that pay out dividends, which are portions of a company’s earnings that are given to shareholders on a consistent or one-time basis. Dividends distributed to a shareholder in cash can be a way for investors to retain an ongoing income stream from their investments even when share prices stagnate. As of 2021, 385 (or 76.2%) of S&P 500 companies paid dividends. 

The bottom line

Even for those who are within a decade of retirement age but have little or no retirement savings, it’s not too late. Investors should figure out when they want to retire to determine how much money they need to start saving and whether they’re on track. 

Especially for those who are behind where they want to be, it can help to max out retirement contributions, including the special catch-up contributions that increase annual limits for workers 50 and older. Paying off debt and avoiding lifestyle creep can help investors set aside more money for retirement accounts. They may also be able to shore up funds by taking on side jobs or planning to work in retirement, as well as investing in the stock market.