Speaker A
My husband and I have been married for 17 years. I am 42 and he is 48. And uh we made peace a long time ago with not having children, so we haven't been the best stewards of our dual income no kids money over the years.
A couple in their 40s with no retirement savings navigates late parenthood and financial planning with expert advice from The Ramsey Show.
Key Takeaways
- It's never too late to start saving for retirement, even in your 40s or later.
- Living in the present and embracing new financial realities enables better decision-making.
- Consistent monthly contributions and leveraging retirement accounts can build a solid nest egg.
- Avoiding consumer debt and maintaining an emergency fund are critical foundations.
- Professional financial advice helps create a tailored plan to meet retirement and family goals.
Summary
- A couple married 17 years, ages 42 and 48, unexpectedly had a baby and have no retirement savings.
- They have no consumer debt, a mortgage with $130,000 owed, and $30,000 in cash savings.
- The wife is currently a stay-at-home mom, planning to remain so for 3-5 years.
- The husband earns $90,000 annually, and they want to start saving aggressively for retirement.
- Expert advice suggests saving 15% of income, using a Roth IRA and 401(k) with employer match if available.
- Projected retirement savings could reach $676,000 to $1.3 million by age 67 with consistent monthly investments.
- They are encouraged to embrace their new life situation and rebuild financial goals rather than dwell on past spending habits.
- The importance of starting retirement savings immediately, regardless of age, is emphasized.
- Financial planning should include consulting a SmartVestor Pro to map out a personalized strategy.
- The couple is advised to accept temporary financial discomfort as they prioritize long-term stability.
Full Transcript — Download SRT & Markdown
Speaker B
Okay.
Speaker A
Um we haven't been the worst. Uh we don't carry any debt other than our mortgage, but we have very little in savings and no retirement.
Speaker A
Uh last August, God surprised us with a baby.
Speaker B
Oh.
Speaker C
Ew.
Speaker B
Congratulations.
Speaker A
Thank you. Yeah, so um we are late in life parents and just kind of caught the caught us here going, oh my gosh, we didn't prepare for this.
Speaker B
Yeah.
Speaker A
Um in hindsight, you know, I know we should have been planning for retirement for ourselves all along even without a baby, but now with a baby, I feel like I am at ground zero and I have no idea what to prioritize and where to start to give us a fighting chance at not only retirement, but just, you know, solid financial stability while raising this baby in this crazy expensive world.
Speaker B
Totally. Are you guys both working?
Speaker A
Um I quit my job in April um when I was about halfway through my pregnancy and I am currently a stay-at-home mom.
Speaker B
Okay. Are you going to go back at all, do you know, or will you wait probably for a bit and be a stay-at-home mom?
Speaker A
I will I will wait for a bit. Um the intention is to not. I'd like to just remain a stay-at-home mom, but at least for the first three years, three to five years is the plan.
Speaker B
Sure. No, that's great.
Speaker B
How much does your husband make?
Speaker A
He makes 90,000 a year.
Speaker B
90,000. Okay.
Speaker B
Do you guys have any consumer debt?
Speaker A
No.
Speaker B
No.
Speaker B
Okay.
Speaker B
Um any savings, just cash savings?
Speaker A
I've got about $30,000 in the bank.
Speaker B
Okay, that's great. Good emergency fund. Okay.
Speaker B
So what's wild is, and I'm just going to run some rough numbers here. Um we have an investment calculator on Ramseysolutions.com. So check it out because that's just always like a, it's kind of a fun thing just to piddle with and look. But let's say, because we always say to save around 15% of your income. So I'm I just threw in a thousand bucks a month. Say you you guys invested a thousand bucks a month and you guys have nothing right now. Um and we'll say your husband's 48. I'm going to use his numbers since he's the one working. Um and then let's say he retires at 67 at a 10% rate of return, that's about $676,000. So that's not as much as I would probably want.
Speaker B
So that's not as much as I would probably want.
Speaker B
So what if we just again, I'm just messing around with this. Let's just say we um you doubled it, then that would be 1.3 million if you guys save two grand a month.
Speaker A
Two two months.
Speaker B
Um because the goal because the reality is too, his income's going to go up, right? Throughout his 50s, he'll be making more. Um so I think you guys if you start now, I think you will end up being fine. I mean, do you think after all is said and done, I mean, if you if you guys had 1.3 million at when he's 67 in order to retire for instance.
Speaker A
Yeah.
Speaker B
And you guys, you know, if it was a 10% rate of return, you know, you'd be making 130,000, but you wouldn't want to take all of that. So let's say you took 70,000 of that to live off of it retirement if everything was paid off, you know, that could probably be a possibility, right? So,
Speaker B
All of this to say, there's still hope. It's not like you guys are um doomed by any means, but yeah, I I would start, right? And and maybe be a little bit aggressive towards it.
Speaker B
How much do you guys owe on your house?
Speaker A
Uh we owe 130. There's about 300,000 in equity in it. So.
Speaker B
Okay, great. No, that's awesome.
Speaker A
And then the other ditch effort would be, do we sell the house and take that, you know, chunk of money and start kind of moving, you know.
Speaker B
No, I wouldn't do that.
Speaker C
No, no, no, no, no.
Speaker B
No, you're fine.
Speaker C
You just rob Peter to pay Paul.
Speaker B
Yeah, y'all are fine. You're good.
Speaker A
Yeah.
Speaker A
And and we have our our mortgage is it's 3.85, so it'd be silly to.
Speaker B
Yeah, no, I think you guys are good.
Speaker C
I'll pay that house off.
Speaker B
I would sit down with a SmartVestor Pro, Amanda, you can go to Ramseysolutions.com and find one in your area.
Speaker B
But I would map out to say, okay, let's open up um he needs to have a Roth IRA. You can do a spousal Roth IRA.
Speaker B
Uh does he have does his company have a 401k?
Speaker A
I think they do.
Speaker B
Okay.
Speaker A
I'm pretty sure they do.
Speaker B
Well, I would ask and see if they do a match.
Speaker B
Um yeah, because there's definitely there's definitely a path for you guys to have retirement, 100%.
Speaker B
Um but again, it will be you guys, yeah, jumping on the train and, you know, moving forward with it.
Speaker B
But I would sit down with someone and look over your entire financial picture because you're in a great spot, Amanda. I mean, honestly, you guys have no debt. You have $30,000 in savings.
Speaker B
And then you guys are going to just start putting some money away monthly uh toward this retirement and with compound interest and all of it, it's great. It's that's the best time to start is now.
Speaker C
So, Rachel, one of the things that I hear all the time that haunts couples in this situation is the phrase, I just want to get back to.
Speaker B
Hmm.
Speaker C
Right? Like, remember when? I should have back in the day, we should have been saving money. I just want to get back to we could just go out to eat whenever we wanted and we could.
Speaker C
The couples that I see do well are the ones that, oh, we have a baby at 42 and 48, right? Who can put a period at the end of that old life and not try to reclaim what was, but to rebuild something totally new. And it's saying, we had our fun. We spent it, we went on every vacation. That was awesome. And now inside this new world we live in, with a kid, with, oh gosh, we need retirement. This kid might want to go to college, all those things. Um, we're going to have to create a new kind of awesome inside this new world. And the couples that live in that reality, what they come up with to to co-create in their life is amazing. It's awesome. The ones that are trying to live this life but keep their looking back at the old them, dragging it behind them, man, it just becomes such a weight. And that's a recipe for people who go off and make decisions that they would never make, borrowing, cheating, all these things because they're carrying around this past and instead of just saying, dude, all right, this is our new world. And we're going to go fully into it, right?
Speaker B
So true.
Speaker B
That is so interesting because I would think if you're carrying what what you wanted or what you thought would be, then you kind of like your your creativity, your brain move, it all kind of just stops there. It doesn't allow you to say, okay, if I have this whole forward life, what are we going to do differently? What what can we do creatively to change up what we want if we want to get.
Speaker C
We're going to become a hiking couple, right? We're going to we're going to, you know what? We're going to learn how to camp because that's what we have money for. And we're going to be the best campers or like or whatever, right? But we're going to live in this reality and we're not going to sit down there thinking about, oh, remember when? We're going to fully embrace what we got and we're going to run forward with it.
Speaker B
So good. Yeah. And in this case, especially looking at retirement and numbers, I think living in the present, realize, okay, this is our new life.
Speaker C
They're going to feel broke for a while.
Speaker B
So now what are we going to yeah, how are we going to shift this?
Speaker C
They're going to feel broke because 2,000 bucks a month that they used to just blow on whatever is going to go into an account for future them, right? And they're going to feel like they're failing, feel like they're broke. And great, cool. Feel that feeling and then just go do the next right thing.
Speaker B
That's right. And what's wild, you guys, is when you're looking at this kind of stuff, like wherever you are financially, if you're in your mid-40s, if you're in your 60s and you haven't started, like the point is to start as soon as possible, right? That's key because time is on your side. It really is. So.
Speaker C
And I can almost guarantee you, they're going to go sit down with their 401k, their HR person and they're going to be like, oh, we have an 8% match. And we have a.
Speaker B
The match is a lot.
Speaker C
And it's like, oh, we didn't know any of that stuff.
Speaker B
And there's more, yes, but it's all about creating this new life and this new future and these new goals, which is what Amanda and her husband are doing. So we applaud you guys, Amanda. We are cheering you on.
Topics:retirement planninglate parenthoodfinancial advicedebt-free livingsaving for retirementRoth IRA401kemergency fundRamsey Showpersonal finance
