Your client is 50, laid off and hasn't saved a dime (okay, if this is really the case he probably isn't your client, but stay with us). He's now forced to figure out he'll do for the next 15 years or more and how he'll ever retire. This is the case study recently proffered by the folks at CNBC, and it caught our eye. We sincerely hope your client's situation isn't this dire, but even if not, the following refresher can help make a bad situation better.
Delay Retirement Age-You're likely going to have to work longer than you'd planned. A 50-year-old who is just starting to save will need to save 56 percent of their annual salary to be able to retire at age 5, according to calculations by T. Rowe Price.
Convert and/or Contribute to a Roth IRA-Those who are 50 or older can contribute up to $6,000 in 2010 to a traditional or Roth IRA. (Also, you have until April 15, 2010 to make your 2009 IRA contribution–up to another $6,000). Income limits for funding a Roth are higher than with a traditional IRA.
