This decade is your opportunity to strengthen your financial foundation, reduce risk, and ensure your future income needs will be met. Every decision you make now has amplified consequences, both good and bad.
1. Take Advantage of Catch-Up Contributions
Once you hit age 50, you’re eligible to contribute more to retirement accounts than younger savers. For 2025, you can contribute up to $31,000 to a 401(k), including catch-up contributions, and up to $8,000 to an IRA if eligible. Use this window to supercharge your savings while you're likely in your peak earning years.
2. Reevaluate Your Investment Strategy
Your portfolio should evolve with your timeline. You may still need growth, but now is also the time to reduce unnecessary risk. A balanced mix of stocks, bonds, and cash reserves helps protect what you’ve built. Consider working with a financial advisor to determine your optimal asset allocation based on your retirement date and income needs.
3. Create a Realistic Retirement Income Plan
How much will you need to retire comfortably? Where will that income come from—Social Security, pensions, retirement accounts, or other sources? Identify your fixed expenses, estimate healthcare costs, and calculate how long your savings will last. Planning this now can help you avoid surprises later.
4. Pay Down or Eliminate Debt
Entering retirement with a mortgage or consumer debt can strain your income. Use your 50s to eliminate high-interest debt and work toward paying off your home. If you can retire debt-free, your financial flexibility will increase significantly.
5. Plan for Healthcare and Long-Term Care
Health expenses tend to rise as we age. Research Medicare, Medigap, and long-term care insurance options now, before they become urgent. If you have a Health Savings Account (HSA), continue contributing—you can use those funds tax-free for qualifying expenses in retirement.
6. Stress Test Your Retirement Plan
Run your numbers through multiple scenarios. What if inflation rises? What if the market drops before you retire? What if you live longer than expected? A solid plan doesn’t just assume the best—it prepares for the worst. Better to adjust your course now than scramble later.
7. Refine Your Estate Plan and Talk to Your Family
Update your will, beneficiary designations, and powers of attorney. Talk to your spouse or children about your wishes and financial plans. Clarity now can reduce confusion and conflict later. You may also want to consider a trust or other legal structures if your estate is complex.
Together, we can work to keep you on-track toward your financial goals.
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Read more articles by Laura Parker