How To Live Richer in Your 40s
Day 27: GOBankingRates wants to help you Live Richer. Throughout the month of July, we’ll be sharing daily tips for how you can do just that, with advice on budgeting, saving, investing, making the most of your career and managing debt — plus money advice for every phase of your life. Check back each day during our 31 Days of Living Richer to learn everything you need to know to set yourself up for financial success and live the richest life possible.
Read Day 26: How To Live Richer in Your 30s
Back to Day 25: How To Live Richer in Your 20s
When you reach your 40s, you may be in your peak earning years — according to PayScale, full-time workers with bachelor’s degrees tend to make the most money in their 40s and 50s, CNBC reported. But just because you may be making more money, this doesn’t mean you should be spending it all. After all, retirement is now just a couple of decades away.
Check Out Day 24: How Debt Prevents You From Living Your Richest Life
Here’s how to live richer in your 40s.
Start Setting Firm Retirement Plans and Goals
“With retirement becoming a closer reality, those in this generation should have a clear vision of their retirement dreams and goals,” said Marcy Keckler, vice president of financial advice strategy at Ameriprise Financial. “If you haven’t already determined how you’d like to spend your retirement and how much you’d need to fund this chapter of your life, now is the time to do this.”
Read Day 23: How To Pay Off Your Debt in a Manageable Way
Consider meeting with a financial professional to help you set these plans into motion.
And Day 22 of Living Richer: How To Stop Accumulating Debt Once and for All
“Now is the best time to sit down with a financial advisor to see if you are on track to retire when you want and adjust your savings to meet those goals,” Walsh said.
Maximize Your 401(k) Contribution
No matter what your retirement goals are, you should aim to make the most of your workplace retirement plan during this decade. Shomari Hearn, CFP and managing vice president of Palisades Hudson Financial Group, advised 40-year-olds to put retirement saving first — even above paying for children’s college education. No one else will save for your retirement, but your kids have other options to pay for college.
Discover Day 21: Top 3 Expert Tips for Managing Debt
For 2021, the maximum contribution amount is $19,500.
And Day 20: 3 Signs You’ve Found Your Dream Job
“At a minimum, you want to contribute enough to your 401(k) to at least take full advantage of any company-match contribution your employer may offer,” Hearn said. “Don’t stop at just making the maximum contribution to your company retirement plan. If your budget allows, consider contributing to a Roth IRA as well.”
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Barbara Friedberg and Morgan Quinn contributed to the reporting for this article.
