The pre-golden years of your life are really the best. You have been through the ups and downs, the highs and the lows, and a lot of memories and stories to tell.

This midlife is the perfect time to really start enjoying your life with all the wisdom you have gained and money you have earned.

However, your midlife is filled with multiple financial challenges. You might be paying heavily for your children’s college fees, their marriage and other such costs. At the same time, you might be running for time to stock sufficient for your retirement as this distant horizon is inching closer. Though you are likely to be in your peak earning years, retiring without a source of income is a bigger risk now.

In short, when you are in your 50’s, the bitter truth is–

So, what should be your financial priorities in your 50’s? How to save money at this stage of life? How to prepare for a comfortable retirement? Let us learn the answer to these questions and get an idea about what your financial planning should look like when you are in your 50’s.

Pay off all your loans and debts

50’s is a phase of serious financial planning, especially regarding loans and debts. You would least wish to spend your 60’s worrying about debts, loans and paying EMIs. So, it is advisable to pay off all kinds of loans (home/car) before you retire as it doesn’t make sense to pay off loans with your retirement fund afterward. You might have taken loans to finance the higher education of your children. However, as soon as they graduate and start earning, you should seek a transfer of the loan to your kids and relieve yourself of debt.

Take your retirement plan seriously

People often underestimate how much money it takes to live in retirement. You are at an older, wiser and wealthier phase of your life. Use it to the fullest to boost up your retirement savings. An ideal retirement plan should earn enough to replace your salary when you retire. However, very few of us saved so much sufficient corpus that it could generate adequate income. As your earning capacity is maximum in your 50’s, channel all your sources to contribute to your retirement plan. Some wise steps to do so:

• Increase the share for your PF account contribution through VPF – voluntary provident fund scheme.
• Forget spending your bonus on petty things. Save it for your future.

In a nutshell, your saving rate should ideally increase with every phase of your life by beginning with 10-15% in your 20’s to 50% by your 50’s.

Stock up for big future expenses

It is not a wise step to spend half or one-third of your entire life savings on your children’s marriage. Now as you are in your 50’s, your children are about to settle or have already settled. They might have started earning and would be on the way to getting married in a few years. Save for these expenses by creating a fund along with your retirement plan. As you are earning pretty well, it is not difficult to spare some money for it. Raiding your retirement account for your kid’s weddings or higher education fees is not the best financial move you would make.

Downsize your expenses

As you step in your 50’s, the number of dependents starts dropping. Your income continues to flow in, and you can save a large chunk of it provided that you limit your need and desire for more physical assets, like house, car, and appliances. Your children may have moved out, and you no longer need a big home or a big vehicle. You can reduce unnecessary expenses. As you downsize your lifestyle, more money becomes available for savings and retirement fund.

Begin to work for post-retirement career

It is not a wise idea to seek a job after retirement. As you are at the conclusion of your earning stage, it is time to consider the next career you would like to have. It can be anything from a teaching assignment at a local college to working for a childcare service. You can also choose any low-stress part-time job. A post-retirement job will not only keep you engaged but will also contribute to your everyday expenses. However, your 50’s is the right time to think about it and build appropriate grounds for it. Start networking through your colleagues and friends to find possible opportunities before you retire.

Revise your health insurance cover

You might have a health insurance policy with sufficient coverage. But as you are approaching older age, you are becoming more prone to medical emergencies. As health cost is inflating rapidly, you are less likely in a state to meet your medical bills with savings, especially when you have retired. So, it is the right time to boost your health insurance policy with top-up plans.  

A comfortable retirement highly depends on how you plan your finances in your 40’s. However, a few wise decisions in your 50’s can make your post-retirement life easier. Afterall, 50’sis a wonderful phase of your life knowing that you have fulfilled all your responsibilities and that it’s time to retire to live for yourself.

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AN AUG 38/18

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