# Five Money Moves to Make Before You Turn 40
Your 40th birthday marks a turning point for your finances. The decade ahead shapes retirement readiness, so acting now matters. Here are the moves that deliver real results.
**Max out retirement contributions.** If you earn under $161,000 (single) or $240,000 (married filing jointly) in 2024, contribute to a Roth IRA. The annual limit is $7,000, or $8,000 if you're 50 or older. A 401(k) accepts up to $23,500 yearly, or $31,000 with catch-up contributions. At 40, compound growth still works in your favor. A $10,000 annual contribution becomes roughly $635,000 by age 65, assuming 7 percent annual returns.
**Eliminate high-interest debt.** Credit card balances at 18 to 22 percent interest drain wealth faster than investments grow it. Pay down cards before maxing retirement accounts if your rate exceeds 10 percent.
**Review insurance coverage.** Term life insurance costs less now than later. A healthy 40-year-old pays roughly $30 to $50 monthly for $500,000 coverage over 20 years. Disability insurance replaces 60 percent of income if you can't work. Most people ages 35 to 65 face a one-in-four chance of experiencing a disability lasting 90 days or longer.
**Build an emergency fund.** Six months of expenses sitting in a high-yield savings account at 4 to 5 percent APY protects against job loss or medical emergencies. Online banks like Marcus, Ally, and American Express offer these rates without monthly fees.
**Audit your investment mix.** A 40