When you reach your 50s, it is crunch time for saving for retirement. If you set a , pensions savings , objective but have been neglecting it, you need to sand it off for a cautious evaluation. ( Working with a financial adviser , can help get you back on track. )
Take these steps in your remaining pre-retirement times to ensure you find that once you’ve familiarized yourself with the financial place you want to go to.
1. Set realistic goals
Initial item for concern: your savings and investments so far. Hopefully, you’ve been stashing away money consistently, making maximum contributions to , 401 ( k ) plans , and , IRAs, as well as other accounts.
How much is enough?  , That depends on your life and bills, potential medical expenses and the kind of support you’ll own from, say, a pension plan and Social Security.
Be careful not to set the bar very low as you evaluate your savings goals. Use a , pensions calculator , to get a better idea of how much you might need to keep.
If you need some help, visit in the professionals. Consider meeting with a fee-only , economic adviser , who can make sure you’re on the right track.
2. Tackle bill
Lingering debt is one of the things that may prevent you from saving for retirement. By the time you’re 50 years old, one large loan obstacle you may have left to distinct is your , loan.
Mortgage-burning celebrations were after a fun way to celebrate the liberation of owning your home for good. However, that rite of passage is becoming less prevalent. In truth, 44 % of people between the age of 60 and 70 have a loan when they retire, according to a , study by American Financing.
Without a mortgage to pay for, you may rely on saving or , investing in the stock market. Paying off your home will probably get time, but in the long run, it’s worth it.
3. Take advantage of catch-up achievements
It’s not too late to start saving for retirement if you did n’t make it a priority in your early years. At age 50, you can start making extra contributions to your tax-sheltered retirement accounts ( called catch-up contributions ).
Younger workers can only contribute$ 23, 000 to their 401 ( k ) s and$ 7, 000 to their IRAs in 2024. But Americans aged 50 and up can contribute up to$ 30, 500 in a 401 ( k ) and up to$ 8, 000 in an IRA.
If you have n’t set aside enough money for emergencies, you might have to use up your retirement savings for an emergency. Just keep in mind that tapping your 401 ( k ) or IRA before age 59 1/2 will cost you.  , There are exceptions, but in most cases you’ll pay a 10 % penalty for an early withdrawal.
4. Create a health saving accounts
Making plans to cover unexpected medical expenses is another crucial stage. A lifetime of savings can immediately be exhausted by high medical bills.
A couple in their mid-60s did want$ 330, 000 to include health care costs in retirement, according to a , 2024 Fidelity Investments measure. Then there is the soaring cost of nursing homes ‘ expanded care.  , A report from Genworth Financial , says the median annual cost of a semi-private room in a nursing home was$ 104, 028 in 2023. In keeping with that, coming medical expenses must be taken into account when planning for retirement.
One solution is long-term treatment insurance, which pays for expanded health care, including such things as medical and assisted life. If you have a high deductible health plan ( HDHP), you should also consider opening a , health savings account , ( HSA ). Your taxable earnings will be reduced as a result. Your benefits, which is be , invested, may grow tax-free. Once you reach the age of 65, you can withdraw money without paying any taxes or penalties ( savings only are subject to taxation if you use it to pay for expenses besides qualified medical expenses ).
You’ll want to compare the features available before choosing an account, such as small monthly fees or minimum stability requirements.
5. Make the most of Social Security
The earliest you can start taking , Social Security , is essentially age 62. But at 50, it does n’t hurt to start thinking about your plan for collecting benefits. You may use , Bankrate’s Social Security calculator , to measure your rewards.
Most folks take Social Security, according to experts, to first. That’s a blunder. Retirement is delayed, but it also gives you the opportunity to make more money. The size of your regular advantage checks also depends on this. Your monthly benefit amount increases by about 76 %, according to Elijah Kovar, co-founder of Great Waters Financial in Minneapolis.
Waiting to collect Social Security, Kovar says, is also a great idea if you’re married and you earn more money. The surviving family retains the larger Social Security benefit if one spouse surpasses the other. By having the higher earner wait to say their gains, you’ll have a bigger container to pull from in retirement.
Another critical consideration when deciding , when to get Social Security , is your income situation. Kovar says from a tax point, it’s the best source of income we have outside of Roth IRAs. Implementing techniques that may lower the amount of money that is subject to taxation, such as donating property to charity, is another factor that contributes to maximizing your Social Security benefit.
6. Build income beyond investing
Your assets are likely to provide you with a stream of income when you retire. Besides your investment and retirement benefits, however, you may think of different ways to increase your income, like getting a side rush.
A , 2024 Bankrate survey , found that 36 % of Americans earn more money on the side. If you’re behind on saving for retirement, working as a specialist or freelancer may be able to add extra income. And it’s less dangerous than other roads like , buying an income.
7. Do n’t abandon stocks in your portfolio
You’ll probably need to gradually move your investment profile toward safer investments like bonds and fixed-income assets as you approach retirement. But it’s important to remember that when you’re in your 50s, you may still have a decade or more before you retire, so you wo n’t want to abandon stocks completely.
Companies typically have higher growth potential than fixed-income investments, which can increase your portfolio’s growth potential and beat prices. Even , when you reach retirement, you may want to keep a portion of your investment in companies to ensure your investment lasts. A decade or more of experience allows you to recover from temporary costs that might result from stock market volatility.
Working with you  is a financial advisor help you choose the best retirement investment strategy.
___
© 2024 Bankrate .com.
Distributed by Tribune Content Agency, LLC.