Reaching age 50 can bring a fresh perspective on retirement planning, and it’s never too late to refine your strategy. Investing for retirement at 50 often involves balancing growth potential with risk management, making it essential to evaluate your savings, adjust asset allocation and maximize contributions to retirement accounts. Whether you’re catching up on savings or fine-tuning your financial goals, focusing on options like 401(k) catch-up contributions, IRAs and diversified investments can help you build a stronger retirement portfolio.
Consider enlisting the help of a financial advisor who specializes in retirement planning. Connect with your advisor matches today.
How Much Should You Have Saved at 50?
There isn’t a hard-and-fast rule about how much you should have saved by the time you get to age 50, but there are available averages to help you gauge how far behind you might be. Generally, most experts would say that five to six times your yearly salary is a good benchmark.
For example, if your annual income is $80,000, a target of $480,000 in savings may help keep you on track. However, this guideline is not one-size-fits-all and should be adjusted based on factors like your retirement goals, lifestyle expectations, and planned retirement age.
You can’t change the past, either way, so don’t worry about what you should have been doing and instead, think about what you can do now to make sure you’re ready for retirement.
Figure Out Your Retirement Goals
Before you start investing, you need to think about what your retirement goals are and what you want to do when you retire. At what age would you like to stop working? Will you continue to work in a part-time capacity once you’ve retired? Do you want to live in the city you currently reside in, or are you interested in moving? Do you want to travel or do anything else that you weren’t able to do while you were working?
Once you’ve answered some of those questions for yourself and your family, you’ll be in a better place to figure out how much you’ll need to save for retirement. You can use SmartAsset’s retirement calculator to see if you’re currently saving enough each month to be where you want to be when you retire. And if you’re not, you can start figuring out how to close any gaps.
What to Do If You Have Nothing Saved
Once you’ve figured out what your approximate money needs in retirement will be, it’s time to figure out how to get there. You’ll want to boost your savings and make your money work for you so you have enough when you reach the age at which you hope to retire. Even if you have no retirement savings at age 50, it isn’t too late to get started. Here are the steps and options you can take:
1. Open a Retirement Account
You should be using a retirement account of some sort to invest your money. Whether it’s a 401(k), a 403(b), a traditional or Roth IRA or some other plan, having an investment vehicle to put away money is key. If you’re kicking up your savings at age 50, chances are you’re decently close to retirement. Because of this, some experts recommend choosing lower-risk investment options like bonds. You won’t see the huge returns that riskier choices like stocks can bring, but it’s less likely you’ll see big losses, even if the market turns volatile.
2. Take Advantage of Catch-Up Contributions
Another thing to remember is that now that you’re over 50, you have a bit more leeway in terms of 401(k) contributions. In 2025, employees can normally contribute $23,500 per year to their retirement plan, up from $23,000 in 2024.
If you’re over 50, though, you can contribute up to $7,500 on top of that because you now have access to catch-up contributions. If you have the means to do it, try to max out your 401(k) contributions. Starting in 2025, people ages 60 to 63 can contribute up to $11,250 in catch-up contributions.
Make sure to find out if your company provides a match for 401(k) contributions. This is essentially free money for your retirement fund, so try to contribute at least as much as your employer will match. Also, pay attention to 401(k) vesting rules: Some companies require you to be employed for a certain amount of time before company matching funds are officially yours.
3. Consider Starting Your Own Business
Once you reach your 50s you likely have acquired a lot of knowledge in whatever industry or industries you’ve worked in. Starting your nest egg late might not be that bad if you’re able to start a successful business. This is often the best way to maximize your earnings, if successful. If you’re self-employed you can also fund a retirement plan and get access to matching funds from your business or an additional amount that you can contribute each year.
How to Invest for Retirement in Your 50s
In your 50s, investing for retirement becomes a balance between pursuing growth and mitigating risk.
For advanced investors, this stage often calls for a nuanced approach to asset allocation. Equities may remain a significant portion of your portfolio, but with a greater emphasis on dividend-paying stocks or low-volatility funds to balance growth potential with income generation.
If you’ve built a solid retirement nest egg by the time you hit your 50s, when you plan to retire will dictate your asset allocation in this decade. For example, Charles Schwab recommends that a person with a 10-year time horizon allocate 60% of their portfolio to stocks, 35% to bonds and 5% to cash. Meanwhile, someone who’s still 15 or more years away from retirement can keep an equity-dominant portfolio, with 95% of their assets in stocks and the rest in cash.
How to Invest if You Have Nothing Saved
If you’re starting with little or no retirement savings in your 50s, the key is to maximize every available advantage within tax-advantaged accounts while pursuing a disciplined investment strategy. Start by contributing the maximum to your 401(k), prioritizing catch-up contributions.
Within these accounts, focus on growth-oriented investments such as diversified stock index funds or ETFs. A higher allocation to equities may be necessary to build wealth rapidly, though maintaining diversification across sectors and markets can help manage risk.
Supplement tax-advantaged savings with investments in taxable accounts if possible. These accounts can house tax-efficient investments, like municipal bonds or ETFs, and provide liquidity for unexpected needs. Additionally, look for ways to boost income or downsize expenses to free up more cash for investing. Staying disciplined with regular contributions and adjusting your portfolio over time can help you catch up and still achieve retirement security.
Consider Your Taxes
Just because you’re retiring, the tax man doesn’t stop coming to your door. When you’re planning for your retirement, it’s important to think about what taxes you’ll need to pay. If you’ve saved for retirement using either a traditional 401(k) or a traditional IRA, you’ll be paying taxes on that money as it is dispersed to you in retirement.
If you used a Roth 401(k) or Roth IRA, you already paid taxes on that money before it was invested, so you’ll be able to withdraw it tax-free in retirement. For this reason, people who expect to be in a higher tax bracket in retirement than they are currently should especially consider using a Roth IRA.
Bottom Line
Even if you’re already 50, it isn’t too late to get serious about saving for retirement. You may not have all the luxuries someone younger does, but through careful consideration and planning, you can get yourself ready to move on to the next stage of your life. Just make sure you have clear goals defined, and that you take advantage of all the opportunities you have to save. With some hard work and discipline, you can be on the path to financial security in your golden years in no time.
Tips for Retirement Planning
- You might want to think about finding a financial advisor to manage your money. A financial advisor will use their expertise to help you reach your retirement goals. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Don’t forget about Social Security. Use this Social Security calculator to estimate what you can expect your Social Security checks to be in retirement. After all, this money will play a role in your overall retirement budget.
- If you want to set up and plan your retirement goals, SmartAsset’s retirement calculator can help you figure out how much you will need to save to retire comfortably.
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