What to Do When Saving Anything Meaningful for Retirement Seems Impossible

Frank is a reader of Money360 who has messaged me on Facebook a few times. He has a solid job working for the state and makes about $42,000 a year. He is married and has three children.

However, Frank’s wife is pretty ill. She has multiple sclerosis and is now wheelchair bound. It is very difficult for Frank’s wife to do many household chores, either.

Frank’s time, then, is eaten up by taking care of his job and taking care of his wife and taking care of his children. It eats the vast majority of his waking hours. He has almost no time for himself; his only real “break” comes a few times a year when his sister comes to visit and takes care of the kids and his wife – he says he usually does a lot of fishing and stopping by to see some friends when his sister comes.

His budget is also strained. Obviously, it’s a single-income family. His wife receives a very small amount of assistance, but that’s it. Frank’s insurance pays for a lot of the expenses, but there are a lot of out-of-pocket things that are needed for a basic quality of life for his wife. He also has to provide basic care for all five of them and make sure his children have a childhood that isn’t too difficult.

The end result? There just isn’t enough money to go around. Frank is 37 years old, has nothing saved for retirement, and doesn’t foresee being able to save any for quite a few years.

I’ve been through Frank’s budget and I agree with him. There’s not much fat there to cut. That entire family’s biggest non-essential expense in the past year, from what I could tell, was about $200 spent on Frank’s combined fishing trips and about $100 each on each child’s birthday and each child’s Christmas presents. Almost everything else comes down to food, household supplies, mortgage payments, medical supplies, and so on.

What exactly can Frank do about saving for retirement? What about anyone in a position similar to Frank?

It’s not an easy question. The lives of many Americans contain very little breathing room or flexibility, and it’s often not due to overspending. It’s due to situations like Frank, where the family is simply faced with some serious challenges that other families don’t have to face.

For example, let’s wave a magic wand and assume that Frank’s wife doesn’t have MS. She’s likely working at that point and if she earns a salary comparable to Frank, you have a household that’s earning $84,000 per year. At the same time, that family is also free from the expenses related to caring for her. The picture completely changes and Frank (and his wife) are easily able to save for retirement.

The truth is that misfortune, particularly in the health care arena, can drastically change the options available to an individual and a family. Millions upon millions of people are in situations like Frank, where circumstances make it very difficult to save anything meaningful for retirement.

So, what can Frank – or anyone in a similar boat – do? Here are some steps that might help Frank – and people in situations like his – open the door at least a little toward retirement savings or other big financial goals.

Start a Side Gig

Everyone’s lives have different constraints placed on them, but for many people, there is some avenue for starting a side gig. All you really need for many side gigs is simply some spare time somewhere.

In Frank’s case, he’s often at home simply taking care of family issues – being a husband, being a father, taking care of household chores, and so forth. He can spend at least some of that time working on some kind of side gig to bring in at least some additional income, then channel all of that income into a Roth IRA (unless things start to really take off).

Here are some ideas that almost anyone can try.

eBay/Amazon reseller: Here, you simply scour eBay and/or Amazon for heavily discounted items, buy them, then resell them a bit later on eBay/Amazon with a better listing and promote those listings in key places. For example, you might buy someone’s trading card collection on eBay, get it to your house, reorganize it, then sell the singles individually and target people interested in those trading cards by listing your auctions on a trading card site that allows eBay listings.

Car stereo installer: If you’re handy with this type of equipment, put up a few ads where you offer to install car stereos at a reasonable price. People bring their cars to you, you install the stereo, and you keep the fee. You can even help people find the right stereo for them and buy it for them (again, likely earning a fee or a small product markup for this).

YouTube video creator: If you have some kind of video camera, a computer, and a reasonably fast internet connection, you can create YouTube videos connected to a personal interest of yours. In Frank’s case, perhaps he could review fishing gear, for example, or give tutorials on fishing techniques. You can make videos covering almost anything you’re knowledgeable about.

Online content creator: You can make a few dollars writing articles on various topics at sites like or . You can also find offers for other skills on there, such as making logos or other similar simple tasks.

E-book writer: If you’re good with words, write an e-book on a subject you’re familiar with and put it up for sale in the Kindle store so that people can buy it, download it, and read it.

One great strategy for someone with a family considering starting a side gig is to make the entrepreneurial venture into a family activity. For example, Frank may be able to work with his children to make Minecraft videos or how-to videos for kids.

The goal is to find activities that fit within the constraints of your life. Everyone has a different situation. Some people find themselves at home with a lot of downtime if they’re actively caring for an ailing family member, for example. Others travel extensively. Some people are currently unemployed, or have jobs with tremendous periods of downtime. Some are extremely busy and can’t even consider a side gig at all (though most people are less busy than they think they are, in my experience).

Find something that works for you – something that fits within your time and location constraints. Something that matches your skills or your passions. Something that doesn’t require a whole lot of initial investment. Then roll with it and see where it takes you.

Evaluate Your Statements

One extremely powerful tool for people who feel like they’re walking a financial tightrope like this is to spend time evaluating your bank and credit card statements carefully. You need to have a firm grasp on where your money is actually going so that you can make smart decisions about spending going forward.

My favorite strategy for this is really simple. Gather up your last few statements for your checking account and your credit cards. Sit down with all of them and go through the transactions. Make a little X by any transaction that isn’t a truly necessary expense. This includes mixed expenses, like grocery store stops where some of the stuff was essential and some wasn’t.

Once you’ve done that, go through the items with Xs again very carefully and look for patterns. Do you see certain things popping up again and again? Coffee shops? Bars? Particular stores? Particular restaurants?

The places that pop up again and again are huge expenses for you. They are the things that are draining a lot of money from your life. It’s not the small $4 items that show up once every few months. It’s the things that gulp down a few transactions a week, each one taking away some of your money.

For each pattern you notice, ask yourself whether that really makes sense. Do you even need to be doing that? If it’s really important to you, is there a cheaper way of doing it? Try to find substitutes for each of the big patterns that you see.

People often take the wrong approach here and think that noticing a pattern where you go to a coffee shop five times a week means deleting coffee from your lives, and they react negatively. “You’ll pry this cup from my COLD DEAD HANDS!” is a frequent reaction, but it’s an unnecessary and incorrect one. The problem isn’t a daily cup of coffee or two. It’s whether you need to stop at Starbucks daily and spend $35 a week just to get a coffee caffeine spike. Why not just make it yourself at home most days? Buying some good beans and some decent flavored creamer is way cheaper than a daily Starbucks visit and you don’t have to wait in line, either. You can just brew it at home while you’re getting ready for the day.

Think about those kinds of substitutions with every single pattern you notice. You don’t have to outright replace everything, but if a common sense substitution for a regular pattern shows up, try that out instead.

Reconsider Your Basic Bills

Your regular bills – the ones you pay and barely think about – often contain some of the biggest money leaks in your life. Your mortgage bill. Your electric bill. Your car payment. Your credit card bills. Your water bill. Your cable bill. Your cell phone bill. Your internet bill. Your gasoline bill. Your food bill.

It is very easy to just get into the routine of paying those bills without really thinking about them, but with each of those bills, you can take major steps to cut how much you pay for them each month without really disrupting your service at all.

Mortgage bill: Can you refinance this bill to get a lower interest rate and perhaps a lower monthly payment? Even more than that, can you move to a place with a lower monthly housing cost and thus have a lower monthly mortgage payment? Both of those options can massively trim your monthly mortgage payment.

Energy bill: There are many, many steps you can take to trim energy expenses in your home. Steps like caulking the windows to block air leaks, installing LED bulbs, putting weatherstrips on the bottoms of doors where air flows through, keeping the furnace and AC off except in extreme temperatures, and other such tactics can really add up to a substantial drop in home energy use.

Car payment: Once a car is paid off, drive it until it’s on the verge of completely dying while keeping up the maintenance schedule. While you don’t have a car payment, put $100 or so a month into savings and use it as a giant down payment when you need to replace that car, which drastically reduces or even eliminates your next car loan.

Credit card bills: Look for balance transfer offers to drastically reduce the interest you pay each month. It’s easy – you’ll just move your balance to a different card that charges a lower interest rate and then pay that new lower rate instead. That means lower interest payments for you. Of course, you can use the savings to instead pay down more of the balance and get rid of the bill entirely much faster than before.

Water bill: Just take little steps to use less water. Don’t pre-rinse your dishes and use the dishwasher for almost everything (unless you are VERY careful, the dishwasher uses less water than hand-washing). Only run full loads in the washing machine and the dishwasher. Take shorter showers and don’t take baths unless you have to. Address any leaking faucets or dripping toilets immediately.

Cable bill: Do you need a cable bill at all? Do you watch enough cable to really make it worthwhile? Perhaps there are other options that fit your home entertainment needs, like Netflix or the internet. Or, perhaps, you can trim some of the optional channels that you rarely watch. If you’re on a recurring contract, you might want to look at a provider switch, too.

Cell phone bill: Do you actually use all of the services you’re paying for? Perhaps there is a lower cost plan that might fit you better. If you’re at the end of your contract, you should definitely try to negotiate a better deal and take advantage of the competition between cell phone companies.

Internet bill: Do you use the internet much at home? Do you need the speed that you’re paying for? Is it “bundled” with other services that you don’t really use? Don’t pay for more internet than you need and especially don’t pay for unnecessary services that you’re not using.

Gasoline bill: There are all kinds of things to do to reduce the cost of gas. For starters, drive with fuel efficiency in mind, which means doing things like preferring right turns over left turns and not accelerating rapidly or braking unless absolutely necessary (coast toward red lights, for example). Keep your car tires inflated to the recommended pressure and keep unneeded weight out of your car (unless you’re facing a northern winter). Buy a more fuel-efficient car the next time you buy a new or used one. The options are endless in terms of small actions you can take to cut your fuel expenses.

Food bill: Much like your gas bill, there are many ways to trim your food bill. Eat at home more often. Make your own meals. When buying groceries, start by looking at the store flyer and making a meal plan for the week based on what’s on sale. Don’t go grocery shopping without a grocery list. Those steps will all drastically cut your food bill without drastically altering your dietary options.

These are basic, smart frugality steps. None of them are pointed at all at taking away some of the joys of life. Instead, they’re steps that cut down on the ordinary bills we all pay.

Naturally, you can cut back on other expenses, but most of the time, people have cut back on those expenses quite a lot when they find themselves in such difficult situations. It’s always a good idea to watch your spending on non-essential items, but it’s often those regular bills that squeeze people who are in situations where saving for retirement is not really an option.

Automate It

If you’ve used a bunch of the above strategies, you’ve likely found some room in your life for saving for retirement, even if it’s just something like $50 or $100 a month. Don’t worry – that’s enough to get started and even that small amount will make a huge difference.

The most important step you can take as you move through this process of freeing up a little money (or earning a little money) for retirement is to keep track of how much less you’re spending and how much you’re bringing in. If you’ve found a side gig that puts $100 a month in your hands and you’ve figured out ways to cut your bills by $100 a month on average, then you suddenly have $200 more each month than you had before. That’s $200 a month you can use for retirement savings.

The trick is holding onto that newly found money. When you slowly see $100 or $200 appear in your checking account over the course of a month, it’s easy to spend that extra $100 or $200 over the course of a month on forgettable things. A few dollars here, a few dollars there, and that money you’re saving is gone.

The strategy, then, is to put that money to work for you immediately. Open up a retirement account right away – a Roth IRA is really easy to open with almost any investment house – and set up an automatic transfer. Move, say, $20 a week into your retirement account from your savings account. Don’t stress out about picking a “perfect” investment yet – you are far better off getting money flowing in there immediately, as you can make your investment choices later on.

If you happen to have an employer that offers a 401(k) plan, you can certainly use that. Just be aware that many 401(k) plans aren’t particularly great options. Unless you’re making above $100,000 a year, I’d choose a Roth IRA for retirement savings, with one exception: matching. If your employer matches your contributions, put that money into your 401(k) because that’s just free money, and that kind of free money blows away the comparative advantages of Roth IRAs and 401(k)s.

Automate this. Make it so that it happens so seamlessly that you don’t think about it any more. It just happens, and it feeds off of the money you saved by making smart financial moves as described above.

Final Thoughts

None of the changes suggested in this article amount to abandoning one’s favorite treats or walking away from key responsibilities. They’re life tweaks, and most people, believe it or not, have enough spare room in their life that life tweaks can expose a surprising amount of money. Even when things seem super tight, you might find that there’s more wiggle room than you think if you take a systematic approach to your finances.

Take advantage of that “found” money. Put it to good use right away and lock in that good use through automatic transfers. If you find a little more, bump up those transfers.

That way, you can keep living the same life you’ve always lived except now that worry about saving for retirement is off of your plate.

Good luck!

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