Retirement Planning at Every Age: What You Should Be Doing Now

Retirement planning is not a one-time event—it’s a journey that evolves throughout your life. No matter where you are in your career, taking the right steps at each stage can help establish a comfortable and secure retirement.

In Your 20s: Laying the Foundation

Your 20s are all about building strong financial habits that will serve you for a lifetime. While retirement may seem far away, starting early can make a significant impact due to the power of compounding.

• Start Saving Now – Contribute to your employer-sponsored 401(k) or open an IRA and take advantage of employer-matching.
• Establish an Emergency Fund – A safety net ensures you won’t have to dip into your retirement savings in case of unexpected expenses.
• Pay Down Debt – Focus on reducing high-interest debt, such as credit cards or student loans, while balancing retirement contributions.
• Invest for Growth – With time on your side, you can afford to take a more aggressive investment approach.

In Your 30s: Building Momentum

By your 30s, you’re likely earning more and taking on new financial responsibilities, such as buying a home or starting a family.

• Increase Your Contributions – Aim to contribute at least 10-15% of your income to retirement accounts.
• Diversify Your Investments – A well-balanced portfolio of stocks, bonds, and other assets can help manage risk.
• Review Your Retirement Accounts – Make sure your investments align with your long-term goals and risk tolerance.
• Consider a Roth IRA – Tax-free withdrawals in retirement can be beneficial if you expect to be in a higher tax bracket later.
• Protect Your Income – Life and disability insurance can safeguard your family’s financial future.

In Your 40s: Maximizing Growth

Your 40s are a critical period to ramp up retirement savings while balancing other financial commitments.

• Avoid Lifestyle Inflation – As your income grows, increase your retirement savings rather than unnecessary expenses.
• Catch Up If Needed – If you’re behind on savings, take advantage of higher contribution limits in retirement accounts.
• Reassess Your Investment Strategy – Verify that your portfolio is diversified and adjusted for your evolving risk tolerance.
• Plan for Healthcare Costs – Consider a Health Savings Account (HSA) to prepare for future medical expenses.
• Check Your Estate Plan – Wills, trusts, and beneficiary designations should be up to date.

In Your 50s: Fine-Tuning Your Strategy

With retirement approaching, now is the time to solidify your financial plans.

• Take Advantage of Catch-Up Contributions – People 50 and older can contribute extra to 401(k)s and IRAs.
• Reduce Debt – Pay off remaining high-interest debt and consider downsizing major expenses.
• Estimate Retirement Expenses – Assess how much you’ll need and create a withdrawal strategy.
• Evaluate Social Security Strategies – Learn the best time to claim benefits to maximize your payout.
• Consider Long-Term Care Insurance – Protect against potential healthcare costs in retirement.

In Your 60s and Beyond: Transitioning to Retirement

As you near retirement, careful planning can confirm financial security and peace of mind.

• Finalize Your Retirement Budget – Determine income sources, including Social Security, pensions, and investments.
• Adjust Your Portfolio – Shift towards more conservative investments to preserve capital.
• Develop a Withdrawal Strategy – Plan how to withdraw funds tax-efficiently to make your savings last.
• Plan for Required Minimum Distributions (RMDs) – Reinforce compliance with withdrawal rules for retirement accounts.
• Enjoy Retirement with Confidence – With a solid plan in place, you can focus on what truly matters in your golden years.

No matter where you are on your retirement journey, proactive planning and disciplined saving can help you achieve financial freedom. If you need personalized guidance, the team at Onyx Bridge Wealth Group is here to help you create a retirement strategy tailored to your goals.