The importance of saving independently for retirement is pretty clear: Without a nest egg, you're more likely to rely heavily on Social Security during your senior years. While those benefits will provide some income, they'll only replace about 40% of your pre-retirement salary if you were an average earner. Most seniors, however, need a good 70% to 80% of their former income to maintain a decent lifestyle. And that's where personal savings come in.

Unfortunately, new data from Wells Fargo reveals that a large percentage of older workers are falling short in this regard. A frightening 39% of baby boomers have less than $250,000 socked away for retirement. And among them, 16% have less than $25,000 saved.

Older man sitting at a laptop bent over with clasped hands, pressing thumbs into his forehead


If you're nearing the end of your career with limited savings, it may not be too late to salvage your nest egg. But you need to act quickly and make the following moves.

1. Start slashing your spending and banking the difference

If your retirement savings are in a sorry state and you're on the cusp of retirement, you'll need to act quickly to boost them. And that means cutting back on spending in a major way so you can free up cash for your IRA or 401(k). To this end, create a household budget to see where your money is going. Then, identify reasonable yet effective ways to trim your costs. That could mean pledging to do all of your cooking at home instead of dining out, canceling non-essential services like cable or the streaming apps you rarely use, and downsizing to a single vehicle rather than paying to own and maintain two.

Will these sacrifices be difficult? Unfortunately, yes. But if you're sitting on little to no retirement savings late in your career, you'll need to go to some pretty extreme lengths to compensate.

2. Generate more income with a second job

Side hustles aren't just for travel-obsessed millennials who need money to fuel their wanderlust spirits. They're also a good way for older workers to increase their retirement savings. If your nest egg could really use a boost, explore your options for a second source of income.

That could mean consulting in your current field or trying something new and more creative. The earnings you generate from your side job can go directly into savings, and as a bonus, you'll have a potentially lucrative gig to carry with you into retirement. (At that point, you may need it.)

3. Extend your career

If you're planning to leave the workforce within the next few years and you're clearly lacking in retirement savings, an effective solution could be to extend your career and bank as much of your earnings during that time as you can. Imagine that, instead of retiring at 67 as you initially planned, you push yourself to work two more years and that during that time, you bank an additional $12,000. That's not a ton of money in the grand scheme of retirement, but when you're behind on savings, every little bit helps.

Working longer achieves a couple of other important objectives, too. For one thing, it allows you to leave your limited savings intact for a few extra years, thereby stretching that money further. But also, it could enable you to delay your Social Security benefits, and that's crucial, because for each year you hold off on filing past your full retirement age, you snag an 8% increase in those benefits that remains in effect for the rest of your life. And when you don't have a lot of savings to work with, the more money you can get from Social Security, the better.

Personal savings are a must going into retirement. If your nest egg leaves much to be desired, do what you can to boost it before leaving the workforce permanently. Though it will require some effort, increasing your savings could be just the thing that saves you from financial distress once your career comes to a close.