Financial Moves to Make in Your 50s | Richard Banks & Associates, P.C.

If you’ve crossed that big 5-0 milestone or are about to, you may be wondering just how your financial situation should be looking.

The answer isn’t a simple one, as all financial situations will look different based on the individual person, but there are some common aspects that you can still check on and work toward achieving in your 50s.

What to Strive For

According to MarketWatch, you should have saved four or five times your annual salary by your 50s.

While this is the suggested amount to have saved up by the time you hit the 50s, various research has found that many are not fully prepared. According to Vanguard, in 2016 “the median retirement account balance for people ages 55 to 64 stood at $66,643. The average for that age group was $178,963. For ages 45 to 54, the median was $43,467 and the average was $116,699.”

Don’t worry if you haven’t managed to save up that amount of money though, because you can still take steps to bolster your savings account. Focus on downsizing your expenses, by taking steps such as moving into a smaller home, and take care to contribute more to your retirement accounts.

Remember, once you’re 50 and older, employer-sponsored retirement accounts will allow you to contribute an additional $6,000 into 401(k) and 403(b) plans.

How to Build Up Wealth in Your 50s

There are many things you can do to build up your savings while in your 50s, besides contributing more to retirement plans.

One of the most important things to do is NOT touch your 401(k), no matter how tempting the money may be. Early withdrawals are not only taxed, but will take away from your retirement savings in the long run.

If you get a bonus at work, try your best to forget about it and stash it away in your savings account or an IRA. While it may have helped you buy a car or home when you were younger, it can now be used as a piece of your nest egg.

It’s also important that you work on eliminating any “bad” debts you may have accrued in life, such as credit card debts. Talking to debt management programs or considering bankruptcy are just two of the options available to you regarding debt.

If you are concerned that debt may be holding back your finances in your 50s, our team is more than happy to discuss how bankruptcy could help get things back on track. Contact Richard Banks & Associates today for a free consultation.