Retiring at 50: Could You Follow This Woman's Extreme Savings Plan?

Americans may be living longer, but our retirement plans aren’t keeping up. Which means people are living longer with smaller bank accounts.

But Marlene Konkoly will retire at age 50. How did she do it? She contributes a whopping 45 percent of the gross annual income she earns as a procurement officer for an automotive finance company to her retirement—all while owning a home and remaining debt-free.

Konkoly is actually well ahead of the retirement savings curve compared to many of her fellow Americans. According to the U.S. Department of Labor, fewer than half of Americans even know how much money they would need to retire. And nearly a third of employees who had access to a defined contribution plan such as a 401(k) did not participate in it.

“Save at least what your employer matches in your 401(k),” Konkoly said. “It’s like saying no to free money if you don’t.”

Konkoly, who lives in Royal Oak, MI, said she started saving at 22—but only because other people said she should. She saved a mere 2 percent at her first job out of college. 

“I didn’t think I could afford much. I didn’t have any understanding of savings and how it would affect my future,” she said.

$17,000 in Debt

At 27, she had $17,000 in credit card debt—but this became a turning point in her financial history.

“I made the decision right then to get myself out of debt,” she said. “I took on extra work where I could. I started to learn how to research purchases before I bought items, and I began budgeting for the first time ever. I successfully eliminated my debt five years later.”

Once she was out of credit card debt, Konkoly, who is single and has no children, turned her focus to her golden years.

“I started to see people around me who simply could not afford to ever retire,” she said. “I knew I didn’t want to be in that position, so I started applying the same principles which got me out of debt toward saving more for retirement.”

How She Got Smart

Konkoly decided to get smart: She took graduate classes in personal finance to understand her portfolio and learn about retirement savings. She reads books, researches on the Internet and follows blogs about saving and investing. And she works with a financial adviser she trusts.

“Just because I can do it myself doesn’t mean I have to,” Konkoly said. “Having a professional adviser allows me to focus on other parts of my life without the time commitment of constantly researching the market.”

Maxing Out Her 401K

Konkoly “maxes out” on everything. She contributes the maximum to her employer’s 401(k), to other retirement investments such as a Roth IRA, and to her employer’s health savings account. She also has a personal investment account for everything else except emergencies.

Fitness for $12 a Month

“My favorite fitness trainer says, ‘Nothing that is easy is ever going to change your body,’” Konkoly said. “The same principle applies to finances. If it’s easy, it won’t move the needle. Yes, it does mean I have to sacrifice in other areas, and sometimes it makes me uncomfortable thinking of all the things I can buy with that money, but I remain focused on my goals to counteract that discomfort.”

To really maximize her savings, Konkoly uses coupons, and takes advantage of loyalty programs, travel miles and credit card points. She streams television on the Internet rather than paying for cable, and subscribes to a $12-a-month fitness video on-demand service instead of a gym membership.

She Pays Herself First

“I put savings at a higher priority than all of the other creature comforts,” she said.

Her One Splurge

She does, however, splurge now and then, and her ultimate passion is travel. For her 40th birthday last year, she spent 10 days traveling to Austria, Hungary, Slovakia and the Czech Republic. She stayed in nothing but five-star resorts, and spent a total of $1,400 on airfare, accommodations, meals and train transportation.

In her retirement, Konkoly plans to continue to travel the world, and says she would love to relocate to Sausalito, CA “for the wonderful weather and gorgeous views of San Francisco Bay.”

DuPage Readers Talk Savings

We reached out to our readers here in DuPage County towns and asked how, like Konkoly, they cut back and save money:

Karen Larson: “For groceries we shop the sale ads and plan meals around that. We also stock up in a variety of things from Aldi's. Aldi's and Trader Joes are owned by the same German company.” – Woodridge Patch Facebook 

Valerie Mager Dickeson: “Cook at home. It tastes better anyway. Walk instead of drive. It’s healthier in more ways than one. And live with the knowledge that less really is more.” – Lisle Patch Facebook 

Meaghan Duncan Kelch: “I take my husband shopping with me. Works great!!! Also cut down on cable and use Internet more for shows.” – Wheaton Patch Facebook

Brenda Spitzer: “I have been enjoying visits to our wonderful local resale shops! I am finding some great toys and clothing for the grand kids and some great items for my house and garden.”  – Wheaton Patch Facebook 

Kathryn Yarema Johnson: “I grocery shop with cash only. And I buy gifts in advance of when they're needed so I can take advantage of clearance sales. (Just purchased my college bound son a $200 wool coat for $32 at Kohls!)” – Elmhurst Patch Facebook

Keith Whistler: “Drive 60 on the freeway, drive the speed limit on town, accelerate slowly, try to avoid unnecessary braking… I worked at Brookfield Zoo and stretched a full tank two and a half weeks by just improving my driving habits.” – Elmhurst Patch Facebook

Rose Johnson: “We have only basic cable, do not use lights while watching TV, burn candles, buy generic foods whenever we can, and we don't drive the car unless we need too. When we eat out we order carry out and bring it home to eat. We use a 10 10 987 for long distance phone calls. We do not spend a lot of time on the phone; instead we send emails.” – Glen Ellyn Patch Facebook

Pam Huisman Hawley: “We plan our meals each week and only buy what we need. And we try to buy as much as possible at Aldi.” – Glen Ellyn Patch Facebook 

Deanna Kariotakis: “Doubled my garden space this year and planted raspberries!” – Naperville Patch Facebook

Jacqueline Diane: “Making your own jewelry, clothes and art or supporting a local high school/college art student.” – Naperville Patch Facebook

Lynda Miller Miller: “Shop at Goodwill and Second Chance for clothes. Urban recycling!” – Lemont Patch Facebook 

Kristen Hager-Butler: “Cloth diapers, no cable TV (we use an antenna), home cooked meals, garage sales/Craig's list for many baby/kid items.” – Lemont Patch Facebook 

Candice Truett: “I use coupons with sales, and almost always do things with my kids that I got from Groupon or Living Social.” – Downers Grove Patch 

Melissa Johnson Inboriboon: “We cut out cable eight years or so ago when I started grad school and barely missed it once we got used to it. We do instant Netflix for some variety (especially for the kids)—it's much cheaper than cable.” – Downers Grove Patch

About this series: As part of our Smart Spending reporting, Patch is profiling people across the country who have found creative ways to save money. Are you an extreme saver? We want to hear from you! Share your story here or in the comments section below.