When you reach 50 years old, it’s a great idea to take stock of your financial situation and decide what further steps you need to take.
So, if you’ve recently turned 50, congratulations!
You’re closer to retirement and it’s the perfect time to ensure you’ve got your finances together.
Here are some ideas of where to turn your focus:
Life Insurance
Once you hit your fifties, it’s a good idea to investigate Over 50 life insurance policies.
The great thing about these is that they’re usually very affordable.
By contributing a small amount each month, you set up an extra financial safety net for your family, in the event anything should happen to you.
Clearing debts
While it’s normal to have some credit card bills you need to pay off and perhaps a mortgage, taking more significant debts into retirement isn’t ideal.
Decreasing your debt increases your chance of an enjoyable retirement. So even if it still feels like it’s a few years off, why not put a plan in place now to pay it off?
If you have racked up quite a large credit card bill, this may be the first place to look.
Whopping interest rates of around 23% are fairly common, and you won’t want this to eat into your nest egg.
Try and wean out of the habit of excessive credit card use so you can focus on simply paying off your debt.
Estate planning
This is a good time to check in with a financial advisor and assess the value of your assets and savings.
Even if you’ve made a Will in the past, it’s important to analyse it every few years in case there are any minor changes (aka: codicils) that you need to make.
Keeping an up-to-date Will ensure that your assets and finances will be distributed according to your wishes.
It’s also the best way to minimise the chance your family will not have any disputes or law cases over the matter once you have passed away.
Savings accounts and investments
Take some time to reevaluate your savings strategy to make sure it’s working in the best interests of your future.
These will be a very useful buffer for you once you retire, especially if you plan to travel or take up more expensive hobbies.
If you have a spare chunk of cash in savings that you don’t foresee yourself needing for another few years, you may want to lock it away in a fixed savings account.
The interest rates are usually better, so you’ll build up a little bit more for your golden years.
It may even be worth considering a cash ISA, where you can stash away up to £20,000 per tax year without paying any tax on your interest rate.
An investment ISA might also be of interest. Following the terms and conditions of your account, you can pay in the income and capital gains from investments without having to worry about tax.
In addition to stocks and shares, this may include collective investment funds, exchange-traded funds, gifts, bonds and investment trusts.
Knowing you’ve got your ducks in order when you reach your fifties can alleviate a lot of background worry.
It frees you up to spend more time planning for the fun things, like any new hobbies, projects and travel plans you want to pursue in retirement.
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