Worried about falling behind on your retirement savings? 3 steps to catch up by 65

The average retirement savings balance among people ages 55 to 64 was about $538,000 in 2022, according to the Federal Reserve. But the average balance among that age group was just $185,000 two years ago. And with such a discrepancy, it’s fair to assume that $185,000 is more representative of older workers’ savings balances than $538,000.

If your IRA or 401(k) plan balance is considerably lower, however, then you may worry about retiring on time—especially if you’re already in your 50s. The good news, though, is that it’s possible to retire by your mid-60s if that’s the time frame you’re aiming for. Here are some steps to get your savings back by age 65.

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1. Apply for the full 401(k) employer match.

It is common for companies to offer a match in their retirement plans. Make sure you know what your 401(k) match entails and make sure you claim every penny.

Some people opt out of their companies’ 401(k) plans because of high fees or limited investment options. There’s nothing wrong with saving for retirement outside of a 401(k). But you’d have to contribute enough to your 401(k) to get any match you’d be eligible for.

2. Work a second gig

If your retirement plan balance is lower than you’d like it to be, it may be because your salary is mostly being eaten up by recurring bills. In this case, the increase in savings could be reduced to making a side hustle for extra money.

You won’t be alone if you do. As of 2022, 36 percent of Gen X workers and 22 percent of baby boomers had a side hustle, according to data from software company Zapier.

The nice thing about working a second job is that you might find a gig that you really enjoy. And if so, you might be motivated to do it once you retire. That continued income could make it easier to leave the workforce on time without having to give up a full-time job until age 70.

3. Rethink your investments

If you’re seven years away from retirement or less and have already pulled your stocks, you may want to reconsider this approach. First, even if you’re within a year or two of retirement, your portfolio shouldn’t be empty of stocks — you should simply pare down so they don’t take up too much room in there. You need stocks in your pre-retirement years to boost your savings, and you also need during retirement to help your portfolio continue to grow.

But if you’re seven years away from retirement or more, you may want to use stocks as your primary investment. At that point, you have some time to ride out a potential market crash, and your portfolio could benefit enormously from assets that can gain a lot of value.

You’re not doomed to a late retirement because you’ve fallen behind on your savings. If you want to retire on time, claim your free money, do a side job for more money, and make your money work for you.