When it comes to preparing for retirement, 50 can be a pivotal age. At that age, most people are just 10 to 15 years away from leaving the workforce, and time is relatively limited to save for retirement.
But with a decade or more of work still remaining, you have enough time to make changes to your retirement savings strategy to ensure you reach your savings goals.
“Add up all of your life savings—your 401(k), your investments, the money under the mattress—and then divide that by 25. Could you live on that amount comfortably for one year?” asks David Rae, a certified financial planner and founder of DRM Wealth Management. “If the answer is yes, then you may be on track for retirement. If it’s no, it’s time to sit down with a fiduciary financial planner to figure out what else you can do to secure your financial future.”
Rae’s formula of dividing by 25 is based on the assumption that people will withdraw about 4% per year from their retirement funds to live on after leaving the workforce.
With that in mind, here’s a look at what retirement and personal finance experts say you should do at age 50 to maximize the likelihood of achieving your retirement savings goals.
