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Workers in their 50s are typically in their peak earning years, and it may seem like retirement is still far off. This is the time to build wealth and eliminate some money stress, but it's also the time to prioritize safety and get serious about retirement planning.
Unfortunately, it's too easy to make some foolish money moves that can reverberate for years to come and throw off your retirement plans. Here are some key financial decisions people in their 50s almost always regret.
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Not starting to invest earlier
You work hard, so it can be tempting to reward yourself with exotic vacations, fancy cars, and expensive meals. But every dollar you spend today is money that will not have the chance to grow for tomorrow.
Many people in their 50s wish they had started to invest earlier so they could have reaped the benefits of compounding.
The occasional splurge is fine, but resist the temptation to spend too much right now. Instead, put money to work in the market so it can cover future needs.
Taking on too much debt
Debt is probably the single most destructive obstacle to financial freedom. This is especially true of credit card bills and other forms of debt with high interest rates.
Some debt is arguably worth taking on, such as a mortgage or student loan debt. But it is best to avoid just about every other type of debt.
If you are in the red, do what is necessary to get into the black as soon as possible.
Neglecting to factor in health costs
As we grow older, health problems are likely to increase. While Medicare covers many expenses, you will still have to pay monthly premiums for coverage and out-of-pocket costs for care.
In addition, you may need long-term care someday. Will you be able to pay for it?
Your 50s are the time to start thinking about and saving for these future bills.
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Not fully funding retirement accounts
The federal government offers people in their 50s a great opportunity to ramp up their retirement savings efforts.
In 2026, workers in their 50s can make an extra $8,000 in catch-up contributions to a 401(k) account.
Workers in their 50s also have the opportunity to make an extra $1,100 to an IRA account.
These are great perks for older retirement savers — but only if you take advantage of them.
Letting adult children drain wealth
Parents love their children and want what is best for them. Unfortunately, that also means adult children can easily pull at their parents' heartstrings when asking for money.
If you are in your 50s, it is important to draw the line when your adult kids request cash. It's fine to help them out here and there, but don't get caught in a perpetual cycle of giving.
Remind your children that if you don't save for retirement now, they might have to take care of you financially later.
Taking too much risk in a portfolio
If you haven't been a great saver, you might try to make up for lost time by increasing the amount of risk in your portfolio.
However, that can be dangerous for people in their 50s. Unlike those in their 20s, you don't have many decades to go before retirement. If the stock market swoons, you will have less time to see your account recover.
So, it's important to keep a good balance between safety and risk. If you are unsure about the right asset allocation, speak with a financial advisor who can provide guidance.
Forgetting to sign up for a Social Security account
The Social Security Administration (SSA) allows all future recipients to set up their own accounts at the SSA website. This allows you to check your earnings history and make sure it is accurate.
An inaccurate earnings history can result in lower benefits in the future.
Staying on top of your earnings history is crucial. As the SSA states, "Ordinarily, you cannot correct your earnings after 3 years, 3 months and 15 days from the end of the taxable year in which your wages were paid."
In some cases, there may be ways around this rule. But why take the chance?
Failing to create an estate plan
Those in their 50s probably have several decades left to live. But unfortunately, that is not true of everyone in this age group.
The sad truth is that death can happen suddenly. If that happened to you, would your family be OK financially?
For an unlucky few, failing to craft an estate plan in their 50s can turn into a major regret for the loved ones you leave behind.
Putting off calculating retirement spending needs
In retirement, you cannot rely on a paycheck to fund your spending wants and needs. Do you know how much money you spend each month now, and how much you are likely to spend during your golden years?
If not, schedule some time to break down likely future spending needs. Doing so will help you establish savings goals that will clarify if and when you will be ready to retire.
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Bottom line
If you are in your 50s, it can feel like there is plenty of time to grow your wealth. But the clock is ticking, and making bad decisions now can have compound effects that impact the rest of your life.
Instead of stumbling into these mistakes, aim to steer a path toward making this a fruitful decade for your efforts to build a nest egg that will see you through your golden years.
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