No matter how much (or how little) you’ve saved for retirement, you can always take steps to better prepare for your golden years no matter how old you are. Whether you just turned 50 or are in your mid-to-late 50s, here are several actions you can take to set yourself up well for the years ahead.

Set retirement goals

Even if you’re still several years away from retirement, you should at least begin the process of mapping out a few retirement goals. Start by picturing your ideal retirement lifestyle, thinking about where you want to live, how you’d like to spend your time, and what activities and/or travel you hope to enjoy. Doing so will help you ballpark future living expenses and thus determine how much income you’ll need to support your plans.

Retirement is expensive

To give you a rough idea of how much retiree households (run by someone age 65+) spend, look no further than the latest U.S. Bureau of Labor Statistics Consumer Expenditure survey with results revealing their annual spending currently averages $61,432 with 36% of these expenses related to housing (mortgage, rent, property tax, and maintenance/repair costs). Keep in mind these numbers will only increase as time marches on (in 2016, for example, the average retiree household spent $45,756 (~$3,800 a month)); the farther away you are from retirement, the higher the threshold in this respect. By setting specific, realistic goals and regularly reviewing your progress, you’ll be better prepared to enjoy the retirement you envision.

Assess your financial situation

Once you’ve mapped out a rough plan, you’ll need to figure out if your retirement income will likely support your desired lifestyle. You can enlist the help of an online calculator just like many others, with internet users performing well over 100,000 monthly searches on this exact topic (per Semrush, a leading marketing insights company). One drawback here, however, is that online tools like this are much too simplistic for the complexity that is retirement.

A better approach? Working with a financial advisor who’ll take a deep dive into your finances and investments to see how likely you are to reach your retirement goals and then outline actionable steps to get you on track if you aren’t. Not only is this something a calculator can’t do, it’ll also give you more confidence in your calculations and plan.

Build emergency savings

Having a robust emergency savings fund is a key part of any retirement plan. Aim to set aside enough to cover a minimum of three to six months’ worth of living expenses (we often recommend up to a year) in a dedicated, easily accessible account. This financial cushion can help you manage unexpected events (e.g., medical emergencies, home repairs, or job loss) without the need to dip into your retirement savings or take on new debt.

Take advantage of catch-up contributions

Catch-up contributions are IRS rules designed to help savers aged 50+ save more money for retirement by allowing you to contribute additional funds to your 401(k), IRA, and health savings accounts beyond standard limits (if you’re at least age 55). Boosting the percentage of income saved can help you reach your retirement income needs to a significant degree and ensure a more secure financial future.

For example, assume you just turned 50 with the goal of retiring at age 66. In planning to cut a few expenses, you determine you can afford to contribute an extra $250 a month to your 401(k) over the next 15 years. Assuming your annual rate of return is a conservative 5% (since 1957, the S&P 500 has delivered an annual return of over 10%), this would land an additional $73,000* in your retirement portfolio!

Review investment portfolio allocations

Taking on more risk in your investment portfolio might seem tempting—especially since your Social Security benefits or pension may not cover your needs—but keep in mind potential downsides like a market crash that could imperil your retirement dreams.

Lean more financially conservative as you age

A recent Fidelity report found that 37% of baby boomers have more stock exposure than is advisable. As you approach age 60, your investment strategy should typically become more conservative with less invested in stocks (known for their volatility) as you won’t have the luxury of waiting out a recovery to recoup your money should a prolonged stock market decline occur. You can seriously jeopardize your financial stability in retirement if you fail to do this—especially if you’re unable to withdraw money at the planned rate—so be sure to align your asset allocation with your planned retirement date, helping to appropriately balance investments for when you plan to start drawing down your assets.

The 100 minus-your-age guideline

While everyone’s financial circumstances naturally vary, a general rule of thumb is to subtract your age from 100 (or 110 for a more conservative approach) to determine your stock allocation: the resulting number indicating the percentage of stocks to have in your portfolio, the remaining portion comprised of more conservative assets (e.g., bonds and CDs). Consider whether a traditional or Roth IRA best fits your needs, knowing individuals in a lower tax bracket may benefit from prioritizing the latter to optimize future tax savings.

Evaluate long-term care options

While this might not be the case for everyone—especially those with a family history of illness at a young age—experts recommend obtaining a long-term care policy (as a stand-alone product or via life insurance) in your mid-to-late fifties to lock in a lower premium.

Will you need long-term care?

According to the U.S. Department of Health and Human Services, someone celebrating a 65th birthday today has an almost-70% chance of needing some form of long-term care (LTC) services in his or her remaining years. What’s more, women are expected to need 3.7 years of care compared to 2.2 years for men (with an estimated 20% of 65 year olds needing care for more than 5 years). Based on this data, long-term care expenses will likely impact your retirement plan—so you’ll need to plan accordingly.

Why obtain long-term care coverage in your 50s?

Seeking long-term care coverage in your mid-to-late 50s is advisable for many reasons, the first of which is you’ll need to qualify (i.e., you must be healthy). As many people see a slight decline to their health in their 50s, it’s easy to see why 30.4% of long-term care applicants between the ages of 60 and 64 were denied coverage in 2022 (rising to over 38% for those aged 65–69 and significantly higher among those age 70+).

Potential out-of-pocket costs for those not covered

Don’t want to pay for a policy? You’ll need to prepare to self-fund long-term care at the very least, all while knowing healthcare expenses aren’t cheap and make up a significant part of these costs. More specifically, various websites (e.g., CareScout.com) report national monthly median costs as $6,483 for a home health aide, $5,900 for an assisted living facility, and $10,646 for a private nursing home room. With both long-term care costs and overall healthcare costs expected to rise in the coming years, it’s critical to plan in advance.

Consider a health savings account

You can use a health savings account (HSA) to pay for qualified medical expenses including out-of-pocket healthcare costs such as deductibles and copays. HSAs offer a triple tax advantage: contributions are tax-deductible, growth is tax-free, and withdrawals for qualified medical expenses are tax-free as well. While such accounts are specifically designed to help people with high-deductible health insurance plans (HDHP), they’re sometimes also an excellent way to save for future healthcare expenses as account balances roll over every year indefinitely. Those aged 55 or older can even supplement the account with an extra $1,000 for “catch-up” contributions, taking advantage of HSA benefits to maximize retirement savings.

Pay down debt

Carrying too much debt into retirement—a constant source of stress for so many retirees—can place additional strain on fixed incomes, forcing you to cut back and tweak the budget you’ve become accustomed to over the years. Creating a retirement budget is essential for managing debt repayment and planning for future expenses, helping you prioritize savings and maintain financial stability.

One of the smartest moves you can make here? Paying off your mortgage, knowing housing is the biggest monthly expense for retirees and you can redirect your money toward other retirement essentials with the corresponding savings. One recent Harvard University study found nearly half of homeowners aged 65–79 are still paying off a mortgage—act sooner rather than later in this regard!

Get started on an estate plan

Estate planning involves creating a blueprint for the preservation, management, and distribution of assets in the event of your death and/or mental incapacitation—and, contrary to popular belief, not just for the wealthy! In doing so, consider the financial support of loved ones and the importance of supporting dependents as part of your overall strategy. At the very least, ensure account beneficiaries and policies are up to date and you’ve completed a will and medical directives.

Boost your income history for Social Security

Though calculated using a complex formula, Social Security benefits are generally based on your highest 35 years of covered earnings and the age at which you begin receiving benefits—with a maximum monthly payout of $5,251 (in 2026). Should you lack a 35-year work history, your benefit calculation will include non-work years with Social Security simply entering a zero for each year with no earnings reported (though individuals can qualify through a spouse’s employment history, with benefits based on this also available). It’s therefore important to raise your lifetime income average by replacing zero or low-income years with higher incomes until you start collecting, helping to maximize the benefit owed to you in return.

Diversify your retirement income sources

Having access to a mix of taxable accounts (e.g., brokerage and savings), tax-deferred accounts (like 401(k)s and traditional IRAs), and tax-free accounts (such as Roth IRAs) provides greater flexibility in retirement and can help boost your disposable income during those years.

For example, let's say you’re in the 24% tax bracket during retirement and your only retirement account is a 401(k) with a balance of $400,000; withdrawing $100,000 would leave you with a tax bill of $24,000.

Now, consider a different scenario where you’re well-diversified and hold $400,000 across multiple accounts ($200,000 in your 401(k), $125,000 in your Roth IRA, and $75,000 in your brokerage account); if you withdraw $100,000 by selling $50,000 of your brokerage investments held for over a year (taxed at 15% for long-term capital gains) and withdrawing $50,000 from your Roth IRA (no income tax), you’d only pay $7,500 in taxes—a $16,500 difference in retirement income!*

In sum: preparing for retirement in your 50s

If you're like most people, you likely haven't yet developed a concrete vision for your retirement. Considerations regarding when to retire, where to live, and how to fill all of your upcoming free time may still elude you—and that's fine! Such details shouldn't deter you, however, from getting serious about the next chapter of your life; taking the steps mentioned in this article can help.

Want to know if you're on track for retirement? Enlist the help of our "Am I on Track?" service to gain insight into how likely you are to reach your retirement goals and (if applicable) take actionable steps to get you back on track. Schedule a FREE discovery call with one of our CFP® professionals to learn more.

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The content in this post was developed by our team of writers and reviewed by our team of CFP® professionals here at Vision Retirement.

Retirement Planning | Advice | Investment Management

Retirement Planning for 50 Year Olds: How to Better Prepare