By your 50s, retirement planning shifts from theoretical to urgent. You have one to two decades before you stop working, and that timeline requires concrete action across several fronts.
Start by calculating your retirement number. Add up your expected annual expenses in retirement, multiply by 25 to 30 (depending on how long you expect to live), and compare that total to your projected savings at retirement. If you're short, you need to either save more aggressively now, work longer, or plan to spend less in retirement. There's no avoiding this math.
Max out retirement contributions immediately. Anyone 50 or older can contribute an extra $7,500 annually to a 401(k) (total $23,500 in 2024) and an extra $1,000 to a traditional or Roth IRA (total $8,000 in 2024). If your employer offers a 401(k) match, capture every dollar of it first. That's free money.
Review your asset allocation. A portfolio heavily weighted toward bonds becomes too conservative at 50. You still have years of growth ahead. Typical guidance suggests holding 60 to 70 percent stocks at this age, adjusted for your risk tolerance and how much you've already saved.
Understand your Social Security options. Claiming at 62 means smaller monthly checks for life. Waiting until 70 increases benefits by roughly 8 percent per year. Run the numbers at ssa.gov to see breakeven points based on your health and family longevity patterns.
Check your healthcare plan. Medicare doesn't start until 65. If you retire before then, you'll need coverage through COBRA, the Affordable Care Act marketplace, or a spouse's plan. Factor these costs into your retirement budget now.
Evaluate your home situation. Will you downsize, or stay put? Dow