Worried about retirement? 3 pain-free tips to boost your savings

Here's how to catch up if debt and other obstacles have gotten in the way of your retirement goals.



Myles Ma

Myles Ma

Senior Reporter

Myles Ma is a senior reporter at Policygenius, where he covers personal finance and insurance and writes the Easy Money newsletter. His expertise has been featured in The Washington Post, PBS, CNBC, CBS News, USA Today, HuffPost, Salon, Inc. Magazine, MarketWatch, and elsewhere.

Published August 18, 2021 | 3 min read

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Almost 50% of workers think they don’t make enough money to save for retirement, a survey released Aug. 5 says. 

The survey from Transamerica Institute, a nonprofit foundation, found a similar share of workers (49%) say debt is interfering with their ability to save for retirement. Transamerica commissioned The Harris Poll to survey 10,192 workers at for-profit companies in late 2020.

“Amid the pandemic, many workers have experienced employment setbacks and financial strain, and some are having difficulties making ends meet,” says Patti Vogt Rowey, vice president of Transamerica Institute.

There was some good retirement news in the survey. It also found that 82% of workers are saving for retirement through an employer-sponsored plan like a 401(k). So for most people, meeting your retirement goals is a matter of doing more. Here’s how to catch up on your retirement savings if income setbacks and debt have gotten in your way.

1. Make your pandemic cutbacks permanent

If you don’t have a budget already, that’s the place to start. You can use our spreadsheet to draft one of your own that includes your income, living expenses, debts, and long-term savings goals like retirement.

Many people have cut back on spending during the pandemic, especially on in-person entertainment and dining out. Consider dedicating part of that spending permanently to your retirement goals, Rowey says. You don’t have to cut these things out of your life permanently, but putting the cost of a dinner out every week into a retirement fund can pay off big over time as it accumulates over the years.

2. Analyze your debt

Almost half of workers say debt is holding them back when it comes to saving for retirement. Balancing these financial priorities can be tricky.

“Depending on the payment terms and interest rates involved, some people may be able to tackle paying off debt while saving for retirement, while others may need to prioritize paying off debt first,” Rowey says.

It makes sense to prioritize high-interest debt, like credit card payments. Interest can grow your retirement savings over time and it can also balloon your debt over time. Tackling your debts based on interest rate is known as the “avalanche method.” You might want to talk to a professional financial advisor to help you decide which debts to tackle first.

Building your credit can also help. The most important route to doing this is by paying your bills on time. Not only does this keep you from falling into more debt, but establishing a good credit score can help you renegotiate better terms for your existing debt.

You may also want to see whether your employer has any debt assistance programs, Rowey says. Some employers have started offering student debt assistance as a benefit.

3. Pay yourself first

It’s easy to put saving for retirement on the back burner because retirement is a long time away. Other priorities like debt, housing, utility bills, food, and fun naturally feel more urgent. Unlike those things, saving for retirement today can pay off a lot more down the line. When you pay $5 for a burger, you get $5 worth of burger. When you save $5 in a retirement account and invest it in the stock market, that $5 can grow into a fund capable of buying many burgers (if your doctor allows). 

One way to make sure you put your money into retirement instead of burgers is to take the decision out of your hands. Automate contributions from your paycheck into your retirement account so it’s never available to spend. If your company offers a match on retirement contributions, save enough to get the full match, Rowey says. That’s free money and it builds up into more free money over time.

“Make saving a habit,” Rowey says. “By starting early and saving consistently, even small amounts can add up over a decades-long working life.”

Image: H. Armstrong Roberts / Getty Images