If your career is a marathon, the years between 55 and 60 are like the middle of the second half. You’re not super close to the end, but you can imagine the finish line. Perhaps even more important, it’s a good time to catch up!
This stretch can be critical for shaping what retirement will really look like. Here are 3 key milestones:
Supercharge Savings
In this last decade of your career, you still have a chance to boost your savings before you shift into spending mode.
If you can, take full advantage of catch-up contributions: an extra $8,000 for 401(k)/403(b) plans and $1,100 for IRAs. Every dollar you invest now has just enough time for growth potential before it becomes part of your income plan.
Not everyone contributes the legal maximum to their retirement accounts, and that’s okay. Consider increasing your contributions by a percent or two each year, and you’ll still wind up ahead.
Get Serious About Health & Insurance
Healthcare is one of the biggest variables in retirement planning—and these years are when you should lock in a strategy.
First and foremost, evaluate your actual health. Visit with your primary care doctor and educate yourself on strategies to improve your physical well-being through nutrition and exercise.
If you’re planning to retire before Medicare eligibility (age 65), make sure you know how you’ll cover insurance in the meantime.
Also, look into long-term care insurance. The premiums aren’t cheap and it isn’t easy to qualify, but for certain situations, this product may be appropriate. Another product to consider is a health savings account. If you have one at work, consider contributing as much as you can. Those dollars get you a tax break now and can be spent tax-free on health expenses in the future.
Finally, reassess your life and disability coverage—by now, you may need less of it, or you may want to restructure policies.
Create Your Retirement Income Blueprint
By 60, you should have more than just a retirement balance—you need a plan for how the money will actually work for you.
Estimate your Social Security benefits and start considering when to claim (early at 62, on time at 67, or later at 70).
Review pension options if you have one, including survivor benefits.
Draft a retirement budget that balances your lifestyle goals with the realities of taxes, inflation, and healthcare costs. In my practice, we’ve seen that this step is one of the most important for financial freedom.
Ages 55 to 60 are about tightening your strategy, safeguarding what you’ve built, and laying the groundwork for a confident retirement. This is where vague dreams turn into a real financial road map!
Play these years right, and you’ll step into your 60s better prepared for the final stretch.
If you would like to discuss your retirement strategy, please schedule a call today!
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.