Here's What I'm Doing to Catch Up on Retirement Contributions in My 30s

If you hope to retire someday, you should consider how you'll fund your non-working years. Many people use retirement accounts to invest money into the stock market. It's beneficial to start saving as early as possible. With the power of compound interest and regular contributions, your nest egg can grow significantly over time.

I started contributing to an individual retirement account (IRA) in my 20s. Although I could afford to pay my bills and had minimal debt, I didn't have much left over, so I couldn't contribute as much money as I would have liked to prepare for retirement.

But all hope is not lost. I'm 36 years old and plan to work for many more years. If you're in a similar situation, you're not alone. Don't avoid investing for your future retirement years just because you're late to the party. I'll explain my strategy to catch up on retirement contributions in my 30s.

1. I'm making investing a priority

I hope to remain healthy and capable of working full time for at least another 25 to 30 years. I also hope to continue bringing in enough income to prioritize making regular contributions to my retirement accounts. Since I'm still in my 30s and want to be able to afford a comfortable life in my non-working years, I'm making investing a top financial priority.

For best success, I treat my retirement savings contributions like a bill. This way, I don't forget or make excuses. That doesn't mean that every single extra dollar I earn is invested. I have other priorities that are important to me, too.

But I have an annual retirement savings contribution goal that I have set for myself and I treat it similarly to how I handle paying my mortgage and utility bills. This strategy helps me stay on track.

2. I have multiple retirement accounts

I've regularly contributed to a Roth IRA since opening one in my 20s. But there were many years when I didn't come anywhere close to maxing out my annual contributions. That means I have some catching up to do if I want to have a sizable nest egg by the time I retire.

The maximum annual contribution amount for a Roth IRA for someone my age is $7,000. But If I only invest $7,000 a year for the next 30 years, I likely won't have enough money to afford a comfortable retirement. So, I have multiple retirement accounts to invest more money.

I'm a self-employed writer, so I opened a SEP IRA in 2022. I make regular contributions to this retirement account to boost my account balances. Having a SEP IRA and a Roth IRA allows me to contribute well beyond $7,000 yearly.

If you're feeling behind, you may want to consider whether using multiple investment vehicles is the right strategy for you. If you're self-employed, a SEP IRA is one retirement vehicle to consider. Another option is a Solo 401(k).

3. I contribute a sizable portion of my earnings

For the past couple of years, I've allotted around 15% of my annual earnings for investing purposes. And if I can afford to do so throughout the next few years, I will contribute closer to 20% of my earnings to maximize how much I can put into my investment accounts.

Don't assume it's too late to save for retirement

Yes, it's beneficial to invest in your early adult years. By investing early and often, you can benefit from compound interest. But even if you're getting started at 30, 35, 40 -- time is still on your side. You likely have many, many more working years. There is still time to invest.

Even if you can only afford to contribute a few thousand dollars a year to your retirement accounts, that's better than doing nothing. Making retirement planning a priority can help you feel less financial stress in the future. Check out our list of the best investing apps to learn more.