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7 Financial Goals to Hit Before You’re 50

7 Financial Goals to Hit Before You're 50
Do more with what you’ve earned.

Financial advisors for successful professionals, executives, and business owners.

Your 50s might seem like a lost decade. Firmly rooted in your career, you’re likely at or near the top of job progression. At the same time, retirement is still a decade or more on the horizon. But, far from stagnating, your 50s should be a fruitful financial period where you reflect on your hard work and savings while positioning yourself for retirement.

If you’re in or near your 50s, you should have these seven financial goals under control. But, if not, it isn’t too late – that’s what your 50s are for. 

1. Have a Cash Buffer

We often look at our 50s as the peak of our career, and, in many ways, this is the case. You’ve likely reached or are close to your career goals and aspirations – whether that’s a leadership position, industry innovation, or simply enough time clocked to have retirement visible on the horizon. 

In any case, your 50s do represent a sort of financial peak: depending on your career goals, you may be hitting or nearing your peak earning potential based on your years of work and job growth coupled with the fact that you can likely count down the time until retirement on your hands.

But your 50s also represent another financial peak: this age range tends to include your spending peak, where your net expenses are higher than at any other period. While most factors are no-brainers, like mortgage management, household repair and improvement costs, car note, and similar expenditures, we often overlook two cost drivers in our 50s: parents and children. Your 50s tend to fall right in the sweet spot of caring for aging parents and having children in their late teens or early college years. This unique intersection often comes with a slew of unexpected costs, making a healthy cash buffer in your 50s extremely important.

In this case, we’re slightly differentiating our cash buffer concept from your emergency fund, though they’re closely tied. In effect, as you near retirement, you want to have the emergency fund and then some to ensure you aren’t forced to take out home equity loans, withdraw from retirement accounts prematurely, or other actions that put your retirement at risk. Since these years can have the most unexpected expenses, keeping at least six months’ income and standard expenses in a high-yield savings account or similarly liquid asset is key. Remember, you made it this far – don’t risk retirement by neglecting your cash buffer! 

2. Cut Out Consumer Debt 

True or false: you should carry a credit card balance from month to month because it helps build credit.

If you said anything but False, sorry. While a pervasive myth, carrying credit and consumer debt accumulating interest has no bearing on improving your creditworthiness. And, while carrying consumer debt may have been an unavoidable chore in your earlier age, you should be financially positioned to be consumer debt-free in your 50s – because you can’t build or assure wealth while you’re still paying down consumer debt. 

With credit card interest rates at multi-decade highs and credit card delinquencies spiking, carrying consumer debt is far too risky for zero rewards in your 50s. At this point in your life, your credit score should be somewhere in the 800-ish range; don’t try to squeeze a few more points from your FICO score by accumulating consumer debt. 

3. Have a Sustainable Investment Strategy

By the time you reach your 50s, you’ve likely developed an investing strategy or, at the minimum, an overarching set of guidelines to shape your deposits, allocations, and position management. And, hopefully, that strategy mellowed as you aged. Short-dated options gambles, throwing cash at the “next big AI/electric vehicle/semiconductor” stock, and over-relying on a handful of mega-caps to ensure a healthy and wealthy retirement are not sustainable investment strategies for your 50s. 

At this point, your core investment criteria shouldn’t be growth at any cost or chasing as many small-cap tech stocks as possible, hoping one or two will be the next Apple, Nvidia, or Tesla. Instead, though growth allocations should still form a portion of your overall strategy, your investment emphasis now should be on capital preservation and sustainable expansion. Dividend stocks, bonds, CDs, value stocks – all have a place, but your best bet in your 50s is to use data-backed, simple investment strategies like buying shares of low-cost, broad index funds and ETFs. 

Whether on your own or with the help of a trusted professional, keep it simple in your 50s: overcomplicating your investment strategy today is the best way to put tomorrow’s retirement in jeopardy. 

Side note: we’ve compiled a list of our favorite ETFs for all ages here. Check it out – if nothing else, you’ll get an idea of what quality ETFs look like and some additional considerations if you choose to go it alone.

4. Protect Your Assets

Just as your investment strategy should pivot toward capital preservation in your 50s, so should your asset protection outlook. While standard legal tools like a will, power of attorney, and similar are important regardless of age, they’re doubly so as you approach retirement and your Golden Years. 

Insurance and estate planning are the two most important asset protection tools you have in your 50s. While you should work with a trusted attorney to determine your specific circumstance’s scope and needs, these tips tend to apply to most in their 50s:

  1. Ensure all relevant documents – wills, powers of attorney, advance healthcare directives, guardianship – are updated within the past five years, if not sooner. As we age and life circumstances change, so too does the frequency by which you should review critical documents. If you don’t have your house in order when it comes to asset protection and estate planning, start here. 
  1. Make sure your investment accounts, including retirement and after-tax brokerage accounts, have designated beneficiaries with accurate contact information. And, it should go without saying, ensure your beneficiaries know their role and the accounts they’re associated with. Properly designating and notifying beneficiaries can save countless time and headaches for loved ones during probate.  
  1. Ensure you have sufficient life insurance – project how much more “earning time” you have left until retirement alongside your family’s current expenses and debts. As a general rule of thumb, targeting a term life insurance policy in the 20 or 30-year range is a safe play for those in their 50s. Your specific retirement plans, current income, and savings all impact term life insurance planning, but working within that general range is a good starting point. Still, working with a trusted professional with term life insurance experienced is the best way to pin down and purchase the best plan for your circumstances. 

These three steps are just the tip of the asset protection iceberg; they’re a great start to shielding your family’s financial future, but far from the last word when it comes to estate planning. 

Financial planning that matches your ambition.

Financial advisors for successful professionals, executives, and business owners.

5. Hit Your Savings Targets

Just because retirement is in sight doesn’t mean it’s time to step off the gas. In fact, at this stage in your investment journey, the power of compounding returns is likely snowballing. Investing legend Charlie Munger said that the first $100,000 in savings and investment is the hardest to come by as compound gains accelerate past this point. Hopefully, by your 50s, you’re well past the $100,000 mark – a good benchmark is to have at least 7x your current annual income saved and invested without counting emergency savings or home equity. 

But don’t rest on your laurels. The more you save today, the better your retirement and eventual opportunity to pass down generational wealth. With a solid fix on expenses in your 50s, you should aim to save and invest at least an additional 15% of your annual gross income.

6. Have the Money Talk

The hardest talk you’ll have with your parents and children isn’t the one you’re thinking of. Instead, having the “money talk” is a potentially awkward but vital conversation to ensure your family is prepared for your collective next steps and everyone is on the same page. You’ll want to have separate talks with your children and parents, each having the same overarching themes but tailored to their respective age brackets. 

For your parents, make sure you agree about their long-term care prospects – do they have the cash for in-home or inpatient care if needed, or do you plan on having a multigenerational household as you retire? Fleshing out contingencies and long-term planning today can save time and money in the future while avoiding needless familial conflict. 

The kids’ money talk will vary based on their age but should revolve around their expected plans and expenditures. Are they going to college, and are they financially positioned to do so? Do they plan on living in a low-cost area, or do they have big-city ambitions? Is homeownership in the cards? As with your parents, projecting your children’s big-ticket expenses in your 50s can help you plan alongside them to help realize their goals and dreams.

Unfortunately, financial education and planning is woefully inadequate in today’s environment. Many children enter college (or beyond) unable to effectively manage cash flow and debt, let alone properly project long-term investment and savings goals. Having not learned it in school, today’s youth need solid role models and common-sense financial advice – rather than leaving it up chance or, worse, social media “gurus,” deliberately discussing finances with your children early and often is the best way to ensure their financial future while protecting the wealth and legacy you leave behind. If you haven’t had “the money talk” with your children as they grew up, it isn’t too late. The best time to do so was yesterday, but the next best time is right now. 

7. Have a Financial Plan

Finally, having a financial plan in your 50s is the best way to set yourself and your family up for your 60s and beyond. Unfortunately, even the best savers tend to put their heads down, grind as hard as possible throughout their working years, then pop up as retirement nears and assume their house is in order. This is rarely the case, but it isn’t too late even without a long-term plan today. 

Plans change over time but, at a minimum, hash out:

  1. How much longer you plan to work and what you expect to earn through that period.
  2. How much you can feasibly stash away between now and retirement beyond existing contributions. 
  3. What your retirement plans are, and how their costs compare to current savings. 
  4. What medical conditions or concerns may impact your retirement plans.
  5. How much you intend to pass down to heirs or children.

These are just a handful of concerns you’ll need to address as part of a comprehensive and well-developed financial plan. Just remember – a plan is better than no plan, and whether you go it alone or work with a trusted financial advisor, taking the time to write out and plan your future is the best way to set yourself up to enjoy your well-deserved wealth in retirement.  

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