Image: Piggy bank © Hemera Technologies, AbleStock.com, Jupiterimages (Image: Piggy bank © Hemera Technologies, AbleStock.com, Jupiterimages)

Joanna VonCulin is 46 and just now starting to save "a measly amount" -- $50 a month -- for retirement. The executive director of a nonprofit in Montpelier, Vt., said she wouldn't even be saving that, but an investment adviser for her agency's retirement plan finally convinced her that "something was better than nothing."

Plenty of expenses and job interruptions got in the way of saving for retirement earlier, VonCulin said. Her son was born nearly four months premature, requiring her to quit working for a time to care for him. Her partner lost a job in information technology and has been struggling ever since to find work that would pay as well. Moving to a good school district for their kids, now ages 9 and 12, meant a sizable mortgage payment.

So VonCulin knows she's behind. She's just not sure by how much, and she's afraid to find out.

She's not the only one. Most people in their 40s and 50s haven't saved enough for a truly comfortable retirement. About 44% of baby boomers and Generation Xers won't even be able to cover basic expenses and are expected to run out of money before they run out of life, according to Jack VanDerhei, research director at the Employee Benefit Research Institute.

For late starters like VonCulin, there's no easy way to make up for lost time. The amounts they would have to save to replace most of their current income in retirement are simply too great.

Those in their 40s would have to save 20% to 25% of their incomes to match what they could have accumulated had they put aside just 10% starting in their 20s, said Delia Fernandez, a fee-only financial planner in Los Alamitos, Calif. If they wait until their 50s to start, they would have to contribute 40% or more of their incomes.

That's daunting. But refusing to save at all because you can't save "enough" is, in a word, stupid.

Image: Liz Weston

Liz Weston

Anything you save will help supplement Social Security, which is likely to be your biggest source of income. If you get serious, you can actually create a decent retirement even with a late start.

But you have to get determined about:

  • Spending a lot less
  • Saving a lot more
  • Working longer

You can't control what happens in the investment markets, the economy or your company's executive boardroom when they're deciding about layoffs. Most people can, however, seize control of what and how they spend, said Jeff Yeager, author of "How to Retire the Cheapskate Way." Spending less allows you to save more now and to consider retiring with a smaller nest egg, since your expenses are lower.

(Article continues beneath video.)

Leigh Devereaux of San Dimas, Calif., had a wake-up call when she was laid off in the wake of the recession. She landed another marketing job within a month and began saving 60% of her net income. She realized she couldn't count on the government or corporations to take care of her, she wrote on my Facebook fan page. "I have only me to count on," Devereaux wrote. "People better get real serious because it's not going to go back to what it was."

Here's what to review:

Consider your house. Housing costs are likely your biggest expense and the biggest piece of the retirement puzzle, Fernandez said. If can pay off your mortgage by the time you retire, you may be able to stay where you are. If you'll still owe on a mortgage or are renting in an expensive area, you'll need to consider alternatives such as downsizing. "The question is, have they chosen a lifestyle they can sustain in retirement?" Fernandez said. "If not, they're have to scale back."

Take a hard look at your other spending. Some expenses, such as commuting costs and payroll taxes, end when you stop work. If you have kids, costs related to child-rearing will likely be finished by retirement. But most people need to look for areas to trim now if they expect to retire comfortably with a late start. "If you focus on the spending side, really drilling down, you can usually find money you didn't think you had to set aside," said Yeager. "Even more important, you're conditioning yourself to live on a budget." You'll find plenty of suggestions on ways to cut spending in the Smart Spending blog and in articles like "5 easy ways to cut monthly expenses," "How to cut your food budget in half" and "6 habits that will make you broke."

Run some numbers. Most people fear they won't have enough for retirement, yet have never tried to calculate how much they might need, according to EBRI research. MSN Money's retirement calculator allows you to test various contribution amounts, investment returns and spending levels. "Maybe the news is not as discouraging as you think," Yeager said. In any case, "once you see (the results), you can come to terms with what it means for your future."

More from Liz Weston: