Retirement is a prominent concern among Americans in their 50s and 60s. According to Bankrate, 56% of Americans think they’re behind in retirement savings. Despite the topic’s stress and worry, it is never too late to prioritize future investments. We have compiled impactful strategies to boost retirement savings as a 50+ year-old.
How Much Do I Need?
Americans are asking themselves how much they really need to be comfortable in retirement. While each situation is unique, a recent poll noted that 32% of U.S. adults would need more than $1 million to retire comfortably. Setting a financial goal will give you a target that informs your future decisions. To get even more specific, try experimenting with a retirement calculator.
Setting a goal can be intimidating, but some investment savings is always better than no investments at all. Compound interest combined with diligent investing could help aid your efforts in creating a secure retirement.
What Can I Do?
While there are elements out of our control when it comes to investing, there are a few that are in your hands. Consider some of these tactics to help boost retirement savings.
Mental Focus
As Americans age into their 50s and 60s, certain biases and assumptions can emerge related to finances. Some of these thought processes can reduce success and even reduce investment returns if used too frequently.
Morningstar Wealth has noticed a prevalent bias called loss aversion. Loss aversion is the tendency to focus too much on the downside and dismiss a possible upside as we age. While this assumption is meant to protect, it can prevent individuals from maximizing their investment potential. Focusing on uplifting outlooks could positively influence the future of your investments.
Catch-Up Contributions
Another element to consider in your investment journey is catch-up contributions. Those who are currently 50+ are eligible to save an increased amount in their investment accounts, up to $30,000 in a 401(k) compared to $22,000 for those under 50. Finding ways to take advantage of this opportunity could help supercharge investment savings.
Prioritize
Once an investment goal is set and our mental focus is locked in, taking a look at your current financial habits could be advantageous. Look at where your income is going and identify if there is any reorganization that could happen to prioritize investing. For even more investment tactics, check out this article: What if you don’t have enough to retire?
Protect
Whether you have reached your retirement goal or are steadily working through an investment plan, there are many avenues available to reach your goal. Life insurance is one way to diversify portfolios and provide wealth for generations to come. Life insurance is offered in whole and term formats to fit your goals, age and chapter of life. Read through some of the details in this article: Using Life Insurance to Build Wealth.
Although boosting investment savings in your 50s and 60s can feel daunting, equipping yourself with the right mindset, tools and strategies could be beneficial to your long-term financial plan.
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Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk.
Investments are: Not Guaranteed—Involve Risk—May Lose Value.