Warning! Warning!  Your fifties may be your last opportunity to eradicate debt and save every penny you can toward retirement.  You must begin now, before it is too late.

There are so many things to consider during this critical phase of retirement planning.  Will you sell your house and move?  Will you downsize? Will you tap into the equity in your home with a reverse mortgage?  How will you cover medical costs?

Don’t Despair.  You Still Have 10-15 Years Before Retirement to Get Things on Track.

For one thing, you will probably be earning more than ever and have fewer expenses when you are in your fifties.  The kids are pretty much on their own or will be soon, college tuition is over or close to it.  Your mortgage payments should be over or ending soon and the payments should be quite affordable by now.  Your fifties is one of the best times for financial planning opportunities.  Once you hit your 60’s, there is simply not enough time left to plan.

At this stage of your life you are either reviewing your existing plan, or you are just now starting to put together a plan.  With the recent economic downturn or due to some cataclysmic financial crisis in your life, you may have had a financial plan that was recently decimated.

What Can Be Done at this Stage to Ensure Your Retirement?

First, you need to sit down and realistically run all the numbers.  This means determining exactly what your financial assets are, what your liabilities are, how long you expect to live, where you want to live, how you expect to live (lifestyle), and how much it will cost.

After you have absorbed the reality of your financial situation, you need to evaluate your position and see what can be done to accomplish your retirement goals.

If you have been diligently planning your retirement for years with retirement accounts, you may wish to re-evaluate the placements of your investments.  For example, you don’t want all your money in highly volatile growth stocks, if you need money for income.  You probably want to move your money into “safer” investments like shorter-term cash investments (CDs) and trade some of your stocks for bonds.  As each class of assets rises or declines in value, you may find it necessary to re-balance your portfolio.

It may be Time to Play Catch Up.

Should you find yourself in your fifties with little or no financial plan, you need to play catch up with your retirement savings.  Keep in mind that the IRS has some limits to these catch up techniques when you are 50 and older.

For instance, if your employer offers a 401k plan, contribute the maximum of $22,000 plus a $5,500 catch up limit.  Check with your tax advisor and/or the IRS for information on the current limits.

Ownership of a traditional or Roth IRA should allow you to contribute up to $6000.  This also includes a catch up limit of $1,000.   Again, check with your tax advisor and/or the IRS for information on the current limits.

Also, pay attention to any new IRS information in this area as things do change.  For instance, there are now many companies that offer Roth 403b plans and Roth 401k plans, which provide employees with the combined benefits of each plan.

No matter what your situation, saving for your retirement needs to be your priority.  Those retirement accounts trashed during the bad economy need to be rebuilt, and you do have the time to do it.  For specific advice, please be certain to contact a qualified professional.