6 Smart Strategies for Investing in Your 60s

Secure your future with tailored investment strategies for your golden years.

By Adam Palasciano

Edited by Eric McWhinnie

Updated Sept. 24, 2024

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As you enter your 60s, your investment strategy may need to be adjusted to align with your retirement goals and risk tolerance.

Whether you're nearing retirement or already enjoying your golden years, making informed investment decisions is crucial to secure your financial future.

Here are six essential tips to help you navigate the investment landscape and make the most of your assets in your 60s.

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Take a second look at your retirement plans

As you approach retirement age, it's essential to review your retirement plans, including your 401(k), IRA, and pension accounts.

Evaluate your projected income needs, expected expenses, and retirement timeline to ensure your investment strategy aligns with your retirement goals.

Consider consulting a financial advisor to help you create a comprehensive retirement plan tailored to your needs. Life circumstances and financial goals may change, so periodic reviews of your retirement plans are crucial to keep them aligned with your objectives.

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Re-evaluate your asset allocation

In your 60s, it's prudent to shift your asset allocation toward more conservative investments to protect your savings from market volatility.

Review your investment portfolio and consider reallocating some of your assets from growth and small-cap stocks to reliable, dividend-paying stocks.

Balancing risk and return becomes increasingly important as you approach retirement to preserve your wealth and generate income.

Keep in mind that while conservative investments offer stability, maintaining a diversified portfolio can help mitigate risk while potentially capturing market opportunities.

Don’t ignore catch-up contributions

If you're behind on retirement savings, take advantage of the 2024 $7,500 catch-up contribution limit the IRS allows for individuals aged 50 and older.

Anyone can contribute up to $23,000 to their 401(k) plan, so for individuals aged 50 and older, that's a total of $30,500 for tax year 2024.

Catch-up contributions can significantly boost your retirement savings and help you reach your financial goals faster. You can bridge the gap between your savings and your desired retirement nest egg by leveraging catch-up contributions.

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Secret: You don't need thousands of dollars to buy thousand-dollar stocks or create a diverse portfolio.

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Let’s say you want to invest $250, as an example.

With that amount, you could build a relatively diverse portfolio with an investment of $50 in a big tech stock, $50 in a retail stock, $50 in an energy stock, $50 in a manufacturing stock, and $50 in a bank.¹

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Max out retirement account contributions

Utilize tax-advantaged retirement accounts to their fullest potential by maximizing your yearly contributions.

Contribute the maximum allowable amount to your 401(k), IRA, or other retirement savings vehicles to take advantage of tax benefits and build a robust nest egg for retirement.

Consider automating your contributions to ensure consistency and discipline in your savings efforts.

Maximizing your retirement account contributions reduces your taxable income and accelerates the growth of your retirement savings, thanks to compounded interest.

Consider low-risk investments

As you near retirement age, consider prioritizing capital preservation and income generation by investing in low-risk assets such as bonds, CDs, and dividend-paying stocks.

These investments offer stability and regular income streams while minimizing the impact of market fluctuations on your portfolio.

Diversify your investments across different asset classes to reduce risk and enhance portfolio resilience. While low-risk investments may offer lower returns compared to riskier assets, they provide stability and protection of principal, which is crucial during retirement.

Be aware of inflation

Inflation erodes the purchasing power of your savings over time, making it essential to account for inflation in your investment strategy. Consider choosing an investment that offers direct inflation protection, such as Treasury Inflation-Protected Securities (TIPS).

Regularly review your investment portfolio and adjust your asset allocation to mitigate the impact of inflation on your retirement income.

Additionally, consider investing in assets with growth potential to outpace inflation and maintain the purchasing power of your savings over the long term.

Grow Your $$: 11 brilliant ways to build wealth after 40

Bottom line

Don't let your retirement become an investment afterthought. Take action now to solidify your financial future.

By following these tips and consulting with a professional, you can craft an investment strategy that safeguards your nest egg, fuels your golden years, and creates the stress-free retirement you deserve.

More from FinanceBuzz:

Invest in Paintings by Basquiat, Picasso, Banksy

Masterworks Benefits

Invest in art like a millionaire for a relatively low cost
Art investments have outperformed the S&P 500 by over 131% for 26 years
Purchase shares of artwork by top artists
Hedge against inflation and diversify your portfolio

Visit Masterworks