Nearing Retirement Checklist
Get ready for retirement by revisiting these saving and investing strategies, and planning for your withdrawals.
Max out contributions to your retirement accounts
Have a workplace retirement plan and/or an IRA? Consider contributing the maximum amount allowed each year.
Enjoy catch-up contributions
If you’re age 50 or older, you may be able to make what are called catch-up contributions to your retirement accounts. For 2019, for example, that means the opportunity to contribute an additional $6,000 in your 401(k) and $1,000 in your IRA.
Invest more with a general investments account
When you’ve maxed out your tax-advantaged options, you can use a general investment account to invest more. Note: These are taxable accounts. If you make money on your investments, then these gains or income will be taxed.
Consider your Social Security strategy
Deciding when to claim benefits will have a permanent impact on the benefit you receive. If you claim before your full retirement age, you can significantly reduce your benefit, while delaying claims can increase it.
Bulk up your emergency savings
Generally, it’s a good goal to have at least three to six months’ worth of living expenses in liquid assets. As you near retirement, consider saving even more if you can. This can mean better security for unexpected expenses, and can provide you with more cash on hand for expenses so you can keep your money invested.
Things to keep in mind along the way
Know how much you can save and invest by keeping a close eye on your income and expenses.
Build and maintain a cash cushion of three to six months' worth of living expenses.
Factor in any debt. In general, a good practice is to pay down any high-interest debt before investing, but you can consider investing while paying down low-interest debt.
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