Personal Finance Checklist For 50-Year-Olds

May 3rd, 2019

If you’re in the 41-60 age range, it’s important to think about retirement and understand how your current career and lifestyle will affect your post-retirement life. Age 50, the middle of this range, marks the beginning of a prime wealth-building period, and though personal finance can be intimidating, here are some ways to make the most of your investments once you enter your fifties.

Understand your Social Security benefits

Social Security projections from the U.S. Social Security Administration are free, and they can also help you assess the state of your retirement benefits based on career earnings. Though this could change based on any subsequent earnings, it will help you understand how Social Security will contribute to your retirement income and whether early or later retirement is the better fit for you.

Assess retirement goals

When you evaluate your Social Security projections, you should also re-evaluate any other retirement savings. Knowing what to expect in terms of projected retirement income will help you plan the timeframe of your retirement and your post-retirement budget.

Use catch-up saving opportunities

If your retirement savings don’t quite match up with your retirement goals, it’s still possible to contribute to your savings. The U.S. government offers catch-up opportunities through tax-deferred contributions to 401(k) or individual retirement account (IRA) plans. These are available once you turn 50, which is a valuable incentive to add a little extra to your contributions.

Save more by borrowing less

Accumulated savings are likely to be less early in your career, especially with the rising cost of loans and mortgages. Later in your career, though, this debt burden should be significantly lessened, and less debt means more in your savings account.

Allocate assets aggressively

It’s a commonly held belief that investments should grow more conservative with age, but your fifties are a prime time to reduce growth-oriented asset allocation. Most people in their early fifties won’t retire for at least a decade and have about 30 years of investment time ahead of them.

Save with senior checking accounts

Free checking can be hard to find, but some banks offer checking accounts with no monthly fees to customers over the age of 50. Check out different checking accounts for a chance to save money every month.

Take advantage of discounts

You can receive AARP benefits when you turn 50. Instead of feeling old, think of the available discounts as a reward for growing older.

Update your will

As you enter your fifties, your financial situation likely won’t be what it was when you were in your thirties. If your will hasn’t been updated since you started a family, the provisions of your will might have changed as your children grew up and your net worth increased. Make sure your will reflects these changes.

Analyze your career opportunities

Do you know if your current employer is the best place to capitalize on your peak earning years? As you gain more experience, your value increases as an employee, so make sure you’re earning your worth. Alternatively, you should also make sure your skills reflect the market, and brush up if they don’t.

With careful attention to your finances once you hit 50, your fifties can also become a great wealth-building period that will lead to a happy retirement.

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