As long as you turn 50 anytime this year, you can start making those catch-up. Your goal by the time you retire at age 67: Have 10X your income saved. In 2020, you can contribute 19,500 on a pretax basis to a 401 (k), plus another 6,500 if you're 50 or older. Waiting to age 70 means your benefit amount increases even more. Though you can start receiving benefits at age 62, you are entitled to 100% benefits at your full retirement age. Keep in mind that delaying collecting Social Security pays off. a year with her husband, and shes on track to retire at the age of 50. "Oftentimes, Social Security is estimated to replace 30% to 40% of pre-retirement income." Remember to also check that retirement plans and pensions have the correct beneficiary listed. If you want to retire at the age of 40 with an income of 20,000, you need to. "This will help set expectations and make plans more realistic," Rogers says. Matt Rogers, a CFP and director of financial planning at eMoney Advisor, also suggests getting a Social Security estimate from the Social Security administration to confirm expected benefits. A common guideline is that you should aim to replace 70 of your annual pre-retirement income. If you realize you haven't, it may be worth making last-minute moves that can save you a considerable amount of money, like downsizing your lifestyle. "Now that you've reached your 60s, it's a critical time to ensure you've saved enough," Meadows says. One way to optimize your savings is to make catch-up contributions in addition to your regular 401(k) or IRA contributions.
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