Ask Sexton Advisory Group: What Retirement Moves Should I Make In My 50s?

If you’re in your 50s, retirement is nearly around the corner for you. This means boosting your retirement savings and investments while minimizing your debts should be your top financial priorities. With over 20 years of personal finance and retirement planning experience as a financial consultant and CEO of Sexton Advisory Group in San Diego, CA, here are a few things I would recommend prioritizing in your 50s.

1. Contribute the max to your 401(k) — If you have a 401(k), contribute the maximum amount every year until you retire – especially if your employer offers fund matching. Doing so is a simple way to responsibly invest your money in retirement, but you’ll also defer paying taxes on this income until you withdraw these funds – this frees up additional funds now for you to allocate to other investment vehicles or paying down current debt.
2. Reevaluate your 401(k) allocations —This is also a good time to reevaluate your 401(k) allocations. As you near retirement, it’s typically recommended to take a more conservative approach. The mutual funds you allocated your 401(k) to in your 20s and 30s is going to look different than your allocations in your 50s. Consider looking into whether your 401(k) plan offers target- date funds, which automatically adjust asset allocations to your goal retirement year.
3. Fund your IRA to the max —In the same vein, I would also recommend funding your IRA to the max every year until you retire. The maximum contribution you can make to your IRA in 2024 if you’re 50 or older is $8,000. This helps pad your retirement investments and savings and if you haven’t been aggressive about contributing the max amount in the past, now is the time to do so.
4. Understand your potential Social Security benefits —Your 50s is also a good time to start diving into what your Social Security benefits could look like. There are plenty of reliable online estimators that can help you determine how much Social Security you can expect to receive on a monthly basis. The longer you’re able to put off claiming Social Security benefits, the more you’ll likely receive in the long run – so this should be factored into your financial retirement plan.