Over 50 and Worried About Retirement? 6 Key Signs You’re Actually Saving Enough

Commitment to Our Readers

GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.

20 Years
Helping You Live Richer

Reviewed
by Experts

Trusted by
Millions of Readers

You may have been dreaming about retirement since the day you started your 9-to-5 job, but the reality is that retirement can be expensive. Being financially prepared for retirement does not happen overnight. It generally takes years to accomplish and often requires some budgeting, but it is achievable.

According to the Survey of Consumer Finances put forward by the Board of Governors of the Federal Reserve System, individuals between the ages of 45 and 54 had an average retirement account balance of $254,720. If you haven’t quite hit that mark and are concerned that you may not be able to retire between 65-67 years old, here are six signs that you may be saving enough for retirement. 

1. You’ve Saved 6x Your Salary

As noted by Fidelity Investments, it is recommended that you have around six times your salary saved for retirement by the age of 50. If you make the average salary (approx. $64,116) of someone between the ages of 45 to 54, then you would need to have saved over $384,000. 

If you haven’t quite saved enough, you can start setting aside more with each paycheck to get caught up. Be sure to take advantage of employer matching opportunities and look at your investment portfolio. It may also benefit you to wait a little longer to retire. A year or two can make a huge difference in the end. 

2. You Have Paid Off Your Debts

Another key indicator that you are saving enough to retire is if you are living debt-free. The more expenses that you can get rid of, the better off you will be. Paying off credit card debt and student loans can help leave more money in your pocket for retirement. Getting your mortgage paid off or at least paid down can also provide a number of benefits. Many people use the equity in their homes as part of their retirement. 

3. You’ve Met with a Financial Planner

Half the battle is simply knowing what retirement will look like. Meeting with a financial planner can help you feel more confident when you finally quit your morning commute. It is a good time to think about what retirement looks like for you and your family. Take into consideration whether you plan to downsize or travel and if you are willing to still work part-time. All of these things may make a huge difference in how much money you will need and at what age you can finally retire.

4. You Are Prepared for Healthcare Costs

One thing that many people overlook is the cost of healthcare after retirement. For the majority of your adult life, you may have had health insurance that was at least partially covered by your employer. Your premium may have been deducted directly from your paycheck, making it something that you rarely even thought about. In retirement, healthcare costs will be very present. You will want to figure out exactly how much you must set aside and plan for unexpected expenses. 

As you age, your health may deteriorate meaning that you could be spending even more on medical care. If you have already thought about and budgeted for these scenarios, you are probably on track for a well-funded retirement. 

5. You Don’t Spend More Than You Make

Financial stability during retirement is all about being disciplined. If you have a bad habit of spending more money than you make, then retirement may be challenging. On the other hand, if you are well-versed in staying within your budget and putting money aside for emergencies, then retirement should be a breeze. 

6. You Don’t Need To Tap Into Your Retirement or Savings Accounts

Finally, if you have a fully funded emergency fund, you might be on the path toward a healthy retirement. Not only is it important to start living within your means, you will also want to make sure that you do not have to dive into your savings every time there is an emergency. 

You might need to revisit your budget if you only have a few hundred dollars each month for discretionary spending. You may be only one vet bill or car accident away from financial disaster which will make retirement that much more difficult. 

If, by the age of 50, you have never had to tap into those resources, then you are probably doing alright for retirement. Staying ahead of the game is important now and in the future. Retirement is about adequate budgeting since your income will likely be reduced. Setting financial goals and achieving them will serve you well even after you pack up your cubicle.

Share This Article: