Turning 50 is a huge mental turning point in a person’s life – it puts a lot of things into perspective. However, this doesn’t mean that it’s too late to start planning your finances. Of course, the whole idea behind this is retirement planning – you’ve reached or gone past the big ‘fifty’ and it’s crunch time! Here’s what you need to know to get you going.
Be realistic
Your 50s are no time for overcompensating and huge expectations; in fact, this is when the word ‘realistic’ should start appearing in your life. Consider your savings and investments thus far; probably (or at least hopefully), you’ve been stashing your funds consistently, paying huge attention to 401(k) plans, IRAs and similar accounts.
So, just how much is enough? This is a question doesn’t have a simple answer; it all depends on your expenses, general lifestyle and potential medical bills and the kind of support you’re expecting from a pension plan and social security.
Of course, setting your bar too low when reviewing your savings goals is one more thing to be careful about. As a rule of thumb, you should aim to reach retirement with savings amounting to at least ten times your last full year’s income from your job.
Get situated
Living in a one-bedroom apartment and living off of ramen is completely fine when you’re thirty, but once you reach the golden age, you’ll want as much enjoyment as you could ever dream of. This is why you need to start planning to move to a stunningly designed home in a, say, secure seaside location that offers recreational facilities, such as golf courses, gyms, pools – basically a resort-like spot for comfortable over 55 living that’s in the proximity of your loved ones. At the age of 50, it’s high time to start planning for this, but a perfect moment would be years before you reach the mentioned cap.
Taking care of your finances
It is preposterous how many people end up paying down their debts throughout the entirety of their lives – debts that they thought they would pay off long before they reach the age of 50. But then, life happens; and when life happens, you don’t want to find yourself at the twilight of your middle age, looking back on a lifetime full of debt slavery. As you start approaching the 50-year milestone of your life, it is crucial that you focus your finances towards debts, as you don’t want to be dealing with these those last couple of years prior to your retirement. Also, make sure you avoid junk insurance that can is often sold alongside other financial products such as credit cards or loans. That is the policy that you cannot use usually sold by banks that you may not be aware of at the time but it can cost you thousands of dollars.
Planning is of the essence here – calculate your current debt load and start paying off increasingly larger chunks of debt as soon as possible – mortgages, large credit card balances, personal loans, car loans – get it all settled ASAP!
Do whatever you can when it comes to your kids’ graduation
We live in an unfair age where school fees are hefty enough to render your kids unable to both pay them off and live a fun, young life without having to work three part-time jobs while studying. Unfortunately, this is how our society works right now, and you’ve probably already invested into a college fund a long time ago. Of course, this means that your children have to graduate as soon as possible and it is up to you whether or not you’ll give in and start enabling them. Discuss this with your kids and, if need be, stop paying their college fees if their college years start stretching well past their 30s. This may sound harsh and even cruel, but spending tens of thousands of dollars on your kids’ irresponsible ways is not doing anyone any favors.
