8 Financial Moves to Make in Your 50s

“For some people, that could be a saving grace,” Shafransky says. 

To qualify for an HSA in 2025, your health insurance plan must have an annual deductible of at least $1,650 for individual coverage or $3,300 for family coverage. In 2025, workers enrolled in such a plan can contribute up to $4,300 for self-only coverage or $8,550 for family coverage, plus catch-up contributions of $1,000 if you’re 55 or older. 

4. Plan for taxes

If you’ve managed to stash a significant amount of savings into a traditional 401(k), it’s important to understand that all of that money — along with any money you’ve invested in a traditional IRA — will be taxed at your ordinary income rate when you take withdrawals.

And once you turn 73, you must take required minimum distributions (RMDs) from those accounts, whether you need the money or not, says Christopher Haigh, a certified financial planner and founder of Iconoclastic Capital Management in Brooklyn, New York. “Some people get bumped up to a higher tax bracket because of RMDs,” he says.

To avoid that, you may want to divert a portion of your contributions to a Roth 401(k) if your employer offers one. Contributions to a Roth 401(k) aren’t tax-deductible, but withdrawals are tax-free as long as you’re at least 59½ and have owned the account for at least five years. And Roth accounts are not subject to RMDs.

Haigh suggests investing some of your savings in a taxable brokerage account. These accounts aren’t subject to RMDs, and the money in them can be tapped at any time without triggering the 10 percent early-withdrawal penalty the IRS typically charges for retirement account withdrawals before age 59½. “That flexibility is really helpful” if you retire early, Haigh says.

5. Pay down debt

High-interest debt, such as credit card debt, can be a major drag on your retirement income. If you’re paying 26.99 percent interest on a credit card balance but only earning an investment return of 7 percent, “you’re effectively 19.99 percent worse off by saving into your investment account than you are paying off the debt,” Shafransky says.

However, not all debts are alike. If you locked in a 30-year, fixed-rate mortgage when rates were 3 percent or lower, you’ll probably come out ahead by investing money instead of paying off your mortgage early, Shafransky says.

6. Plan for long-term care

Even if you’re in excellent health, there’s a good chance you’ll need long-term care sometime in the future. The U.S. Department of Health and Human Services estimates that nearly 70 percent of 65-year-olds will need some kind of long-term care in their lives, and around 1 in 5 will develop a disability serious enough to require long-term care for more than five years. 

Even a few months in a long-term care facility can decimate your nest egg. The median annual cost of a semiprivate room in a nursing home was more than $111,000 in 2024, according to insurance provider Genworth’s annual Cost of Care Survey.

If you’re considering long-term care insurance, decide soon. If you wait until you’re in your 60s or later, the premiums may not be affordable, and if you have any chronic health conditions, you may be denied coverage, according to the American Association for Long-Term Care Insurance.

Still, premiums can be expensive even if you’re in your mid-50s and in good health. One way to lower the cost is to buy a policy that will cover only a portion of your long-term care costs — 25 to 50 percent, for example — and get the rest from your savings. “You don’t have to buy a Rolls-Royce policy” to provide some protection against long-term care costs, Adam says.

Another option is to buy a hybrid policy that combines life insurance and long-term care insurance, says Carolyn McClanahan, a physician and financial planner and the founder of Life Planning Partners in Jacksonville, Florida. 

Hybrid policies allow you to use a portion of the policy’s death benefit to pay for long-term care if you need it. If you end up not needing long-term care, your family will receive the death benefit after you die. Some of McClanahan’s clients have successfully exchanged existing whole life insurance policies with a cash value for a policy that includes long-term care insurance.

If you decide to self-fund the cost of long-term care, put aside enough to cover two to three years of care. Calculate that amount using the Genworth survey’s average costs for where you plan to live in retirement. “If you’re in New York City, it will cost way more than if you’re in Topeka,” McClanahan says.

7. Consider where you’ll live in retirement

If you want to age in place — and 75 percent of Americans age 50-plus do, according to a 2024 AARP survey — take a hard look at your home. Just 10 percent of homes nationwide are prepared for older adults’ needs, and only 40 percent have basic aging-ready features such as a step-free entryway and a bedroom and full bathroom on the first floor.

Will your bathrooms be accessible if you need to use a wheelchair? Can you replace stairs with ramps if necessary?

If you don’t think you can make your home aging-friendly, start thinking about where you want to live when you retire, McClanahan says. “Thinking this through when you’re still healthy can save you a ton of money and angst down the road,” she says.

8. Get your estate in order

At this stage of your life, “it’s really important to have a plan in place if you become disabled and are unable to communicate,” Adam says.

Financial power of attorney gives an individual the right to manage your money if you become incapacitated. Power of attorney for health care, which may be included with power of attorney for finances or addressed in a separate document, gives an individual the right to make health care decisions on your behalf. Without these designations, your family may be forced to go to court to obtain the authority to manage your affairs. 

“Your will is for what happens when you die,” Adam says. “I’m most concerned about what happens while you live.”