I’m 40 Years Old With No Retirement Savings. What Can I Do?

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A lot of people don’t end up having tons of retirement savings by age 40. They often spend much of their 20s paying off student debt and credit cards, and a fair amount of their 30s saving for a home. The median retirement savings balance among people aged 40 is only $45,000, according to the Federal Reserve.Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
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Click here to read our full review for free and apply in just 2 minutes. If you’re 40 and have nothing saved for retirement, you’re probably aware that’s not ideal. But it’s also by no means a hopeless situation. Here’s what to do if you’ve found yourself in catch-up mode.1. Find the right retirement accountThe first hurdle to overcome on the road to building retirement savings is finding a home for your money. You can see if your company offers a 401(k) plan and then sign up. The benefit there is that you may be entitled to a 401(k) match, which means you’ll get free money from your employer for making contributions out of your own paycheck.Plus, 401(k)s are funded automatically by taking the money out of your paychecks. That’s a great way to make sure you’re keeping your commitment to retirement savings.But if you don’t have access to a 401(k) plan, don’t stress. Not every company offers one, and if you’re self-employed, you won’t have access to employer benefits anyway.But you can open an IRA, or individual retirement account, at any financial institution that offers one. And you might enjoy lower fees with an IRA than a 401(k). Click here for a list of the best IRAs you can open today.2. Prioritize savings in your budgetOnce you’ve opened a retirement account, take a look at your expenses and set up a budget that makes room for contributions. You can start off with just $50 a month if that’s all that works for the time being. But it’s important to get started right away.From there, set up automatic contributions to your IRA if that’s the account you’re saving in. You can increase those contributions over time, but make sure some amount of money starts going into that account immediately.3. Figure out where the money for your retirement account will come fromYou may need to consider some changes to your spending and earnings if you want to ramp up your retirement plan contributions. One great option is to pick up a side hustle. This way, you won’t need to cut back on spending.But if working a second job doesn’t fit into your schedule, or it’s just not something you want to do, you can instead look to reduce your spending in a meaningful way. You probably want to reach the point where you’re contributing a few hundred dollars a month to your retirement plan if you’re 40 with no savings. This gives you a chance at retiring with a decent sum of money.4. Invest your money to make up for lost timeIf you’re 40 years old, you may still have another 25 years of work ahead of you. If you contribute $250 a month, or $3,000 a year, to an IRA or 401(k) during that time, you’ll end up with $75,000 in savings based on your direct contributions alone. But in reality, your retirement plan balance could be much larger if you invest your money in stocks.Over the past 50 years, the stock market’s average annual return (as represented by the S&P 500) has been 10%, accounting for years of strong gains and years when stocks did very poorly. If you’re able to snag that same yearly return in your retirement account, then after 25 years of contributing $250 a month, you’re looking at a total savings balance of about $295,000. That’s more than the median $200,000 retirement savings balance 65-year-olds have today, per the Federal Reserve.You may be ready to panic if you’ve reached your 40th birthday with no retirement savings whatsoever. But you’re actually not in as bad a situation as you might think. And if you start making changes quickly, you can turn things around in a meaningful way.Alert: highest cash back card we’ve seen now has 0% intro APR into 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes. We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.”}]] [[{“value”:”

A lot of people don’t end up having tons of retirement savings by age 40. They often spend much of their 20s paying off student debt and credit cards, and a fair amount of their 30s saving for a home. The median retirement savings balance among people aged 40 is only $45,000, according to the Federal Reserve.

Alert: highest cash back card we’ve seen now has 0% intro APR into 2026

This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to read our full review for free and apply in just 2 minutes.

If you’re 40 and have nothing saved for retirement, you’re probably aware that’s not ideal. But it’s also by no means a hopeless situation. Here’s what to do if you’ve found yourself in catch-up mode.

1. Find the right retirement account

The first hurdle to overcome on the road to building retirement savings is finding a home for your money. You can see if your company offers a 401(k) plan and then sign up. The benefit there is that you may be entitled to a 401(k) match, which means you’ll get free money from your employer for making contributions out of your own paycheck.

Plus, 401(k)s are funded automatically by taking the money out of your paychecks. That’s a great way to make sure you’re keeping your commitment to retirement savings.

But if you don’t have access to a 401(k) plan, don’t stress. Not every company offers one, and if you’re self-employed, you won’t have access to employer benefits anyway.

But you can open an IRA, or individual retirement account, at any financial institution that offers one. And you might enjoy lower fees with an IRA than a 401(k). Click here for a list of the best IRAs you can open today.

2. Prioritize savings in your budget

Once you’ve opened a retirement account, take a look at your expenses and set up a budget that makes room for contributions. You can start off with just $50 a month if that’s all that works for the time being. But it’s important to get started right away.

From there, set up automatic contributions to your IRA if that’s the account you’re saving in. You can increase those contributions over time, but make sure some amount of money starts going into that account immediately.

3. Figure out where the money for your retirement account will come from

You may need to consider some changes to your spending and earnings if you want to ramp up your retirement plan contributions. One great option is to pick up a side hustle. This way, you won’t need to cut back on spending.

But if working a second job doesn’t fit into your schedule, or it’s just not something you want to do, you can instead look to reduce your spending in a meaningful way. You probably want to reach the point where you’re contributing a few hundred dollars a month to your retirement plan if you’re 40 with no savings. This gives you a chance at retiring with a decent sum of money.

4. Invest your money to make up for lost time

If you’re 40 years old, you may still have another 25 years of work ahead of you. If you contribute $250 a month, or $3,000 a year, to an IRA or 401(k) during that time, you’ll end up with $75,000 in savings based on your direct contributions alone. But in reality, your retirement plan balance could be much larger if you invest your money in stocks.

Over the past 50 years, the stock market’s average annual return (as represented by the S&P 500) has been 10%, accounting for years of strong gains and years when stocks did very poorly. If you’re able to snag that same yearly return in your retirement account, then after 25 years of contributing $250 a month, you’re looking at a total savings balance of about $295,000. That’s more than the median $200,000 retirement savings balance 65-year-olds have today, per the Federal Reserve.

You may be ready to panic if you’ve reached your 40th birthday with no retirement savings whatsoever. But you’re actually not in as bad a situation as you might think. And if you start making changes quickly, you can turn things around in a meaningful way.

Alert: highest cash back card we’ve seen now has 0% intro APR into 2026

This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to read our full review for free and apply in just 2 minutes.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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