Dear Dave,
I’m 42, and I haven’t started saving for retirement. I’m self-employed and not making a lot of money right now, plus I have about $8,000 in debt. It feels like I’m living paycheck to paycheck, and I just can’t seem to save or get anything paid off. Can you help?
Avis
Dear Avis,
It’s never too late to start saving for retirement. If you’re breathing, there’s still time!
My guess is that it feels like you’re living paycheck to paycheck because you are living paycheck to paycheck. Let’s back up a little and take a look at this. You already know that you’ve got some stuff to clean up before you’ll be in a position of strength. Paying off the debt is a great idea, but how do you make that happen?
If you’re not making much money, you may have to take on a part-time job while you grow your business. It might mean a career change or something as simple as putting in more hours and kicking that business in the tail to really get it running.
A lot of your money is going out the door every month to pay those debts. But if your debt was paid off, you’d have money to invest for retirement. It’s a combination of an income problem and an outgo problem that’s standing in your way, Avis. Get the income up and stabilized, knock out the debt, and then you’ll create cash flow to save and fund retirement!
—Dave
* For more financial help please visit daveramsey.com.