The High Price of Waiting to Plan for Your Financial Future

By Brett Gottlieb

Saving for retirement can seem like a distant dream compared to your other obligations. Waiting to save for retirement comes at a hidden cost—which could leave you scrambling to make up for missed savings in the final years leading up to retirement. We’ll explore the cost of waiting to save for retirement and cover potential strategies for those who are starting later.

Missed Opportunity for Compound Interest

Time is the driving component behind how compound interest works to grow your money. Compound interest is the interest earned on both the principal and the accumulated interest of your investments. The earlier you start saving, the more time your money has to compound.

Conversely, the later you start saving for retirement, the less time your money has to grow.

To illustrate how this works, let’s say you start saving at 30 years old with an initial retirement investment of $50,000, to which you contribute $500 each month. Assuming you want to retire at 65 with an average annual interest rate of 7%, you’d reach retirement with over $1.3 million.

If you started saving at age 40 instead of age 30 with the same initial investment and contribution amount, your money would only grow to reach about $650,000 by the time you’re ready to retire.1

Saving More Aggressively

The longer you wait to begin saving for retirement, the more aggressively you’ll need to save to catch up to your goals. For example, say you want to retire at age 65 with a retirement income of $50,000 per year; if you start saving at age 25 and invest $500 per month, assuming an average annual return of 7%, you’ll have over $1.5 million by the time you retire.

Waiting until age 35 to start saving means you’ll need to invest over $1,100 per month to reach the same goal. Pushing it off for another 10 years costs you even more. Start saving at 45 and you’ll need to invest over $2,700 per month!

To make up for lost time, many pre-retirees may choose to make major adjustments to their lifestyles that accommodate a more aggressive retirement savings plan. This could look like downsizing your home or cutting back on expenses. It might even involve finding ways to bring in additional money. To maintain your current lifestyle and avoid making dramatic changes, it’s better to start saving for retirement as early as possible.2

Delayed Retirement

If you haven’t saved enough for retirement and don’t have the funds to contribute more to your retirement savings plan, you may have to consider delaying your plans to leave the workforce. This option isn’t appealing to most people who’ve spent years looking forward to retirement.

As unappealing as it is, delaying retirement allows you more time to accumulate savings that may carry you through your retirement years. The cost of waiting to save might not be feasible for everyone since older age may come with unexpected health problems, disability, and even a lack of drive to keep working. By saving for retirement as early as possible, you give yourself the option of leaving the workforce on your terms.

So what can you do if you’re a late saver? Here are some ways you can plan to retire even if you’re starting late.

1 These are hypothetical examples provided for illustrative purposes only; they do not represent a real-life scenario, and should not be construed as advice designed to meet the particular needs of an individual’s situation.

2 These are hypothetical examples provided for illustrative purposes only; they do not represent a real-life scenario, and should not be construed as advice designed to meet the particular needs of an individual’s situation.

1.   Assess where you are now.

Calculate how much you have saved for retirement and estimate how much you’ll need in retirement. There are many retirement calculators available online that can help you with this. Once you have a clear understanding of where you stand, you can start making a plan.

2.   Take advantage of catch-up contributions.

If you’re 50 or older, you can make what’s known as catch-up contributions to your retirement accounts. For example, in 2023, you can contribute an additional $7,500 to select retirement plans outside of your standard contribution limits. These catch-up contributions can make a big difference in your retirement savings.

3.   Work with a financial advisor.

Involving a financial advisor who focuses on retirement planning means you’ll learn what the best options are for your unique financial situation. A financial advisor shares their knowledge on planning for retirement and develops a feasible plan to help you retire confidently.

Don’t Wait to Plan or Save

The cost of waiting to save for retirement is significant, but it’s never too late to start planning. Take the proactive approach and work with a financial advisor who can design a custom plan that fits your retirement needs. Learn how we can help you by emailing us at or call (760) 813-2125.

About Our Advisors

Brett Gottlieb is the founder of Comprehensive Advisor and a financial advisor with nearly two decades of industry experience. He graduated from California State University-Chico with two bachelor’s degrees, in business administration and economics, and is Life Insurance licensed in several states. He is passionate about guiding his clients on retirement income planning, helping each client pursue their specific retirement goals, and defending the assets his clients have worked so hard to achieve. Brett is a California native and currently resides in San Elijo Hills with his beautiful wife and three children.

Our team of qualified professionals have experience in the financial service industry, and our advisors hail from some of the largest independent broker/dealers and banking institutions in the country. They have dedicated their professional careers to creating personalized financial solutions for individuals and families who seek successful retirement planning and currently offer investment advisory services through AE Wealth Management, LLC. Our advisors take a common-sense approach to the planning process and work with clients to create a retirement road map to help ensure their assets are protected and they receive the income needed to enjoy their future. Based in Carlsbad, California, they work with clients throughout San Diego County and beyond. Learn more by connecting with Brett on LinkedIn or email them at

Investment advisory services made available through AE Wealth Management, LLC (AEWM). AEWM and Comprehensive Advisor are not affiliated companies. C.A. Financial & Insurance Services, CA Ins. Lic. #6000262. This material is intended to provide general information and is believed to be reliable, but accuracy and completeness cannot be guaranteed. 1802208- 5/23.


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