Over 50? Cut Investment Risk, Maximize Retirement Account Contributions, and Plan for Long-Term Care

You’ve spent decades working, saving, and hoping your retirement nest egg will be enough. But now that you’re over 50, the stakes feel higher. A sudden market dip or a health crisis could upend your plans overnight. The fact is your retirement accounts need protection, not just growth, especially after age 50.

At this stage of life, it’s less about aggressive growth and more about balance, protection, and peace of mind. You’re not alone in feeling this way. According to Northwestern Mutual’s 2024 Planning & Progress Study, Americans now believe they’ll need about $1.27 million to retire comfortably — but few feel confident they’ll get there.

The good news: With the right strategy, you can strengthen your retirement savings and plan for future care needs without sacrificing your lifestyle today.

Boost Savings with Catch-Up Contributions

Individual retirement accounts (IRAs), including both traditional and Roth IRAs. Once you hit 50, the IRS lets you supercharge your retirement accounts. This “catch-up” provision allows you to contribute more than younger workers:

• 401(k) and similar plans (2025): Up to $30,500 per year ($23,000 standard + $7,500 catch-up).
• Traditional or Roth IRA (2025): Up to $8,000 per year ($7,000 standard + $1,000 catch-up).

And thanks to the SECURE 2.0 Act of 2022, beginning in 2025, people aged 60 to 63 can make even larger catch-up contributions — up to $11,250 for workplace retirement plans.

Share your thoughts and experiences about aging, caregiving, health, retirement, and long-term care with LTC News ——Contact LTC News.

These extra contributions can make a meaningful difference late in your career. In your final working years, catch-up contributions are an excellent way to boost your retirement savings and secure your financial future.

Diversify to Reduce Market Risk

In your 50s and 60s, it’s risky to keep all your eggs in one basket. Market downturns can force you to sell at a loss just when you need stability. Diversification helps cushion these blows by spreading risk across different asset classes.

Consider a mix of:

• Stocks for growth potential.
• Bonds for income and stability.
• Cash or cash equivalents for liquidity.
• Real estate or alternative investments for diversification.

Work with a qualified fiduciary adviser who understands your timeline, tax picture, and risk tolerance. Make sure the firm has strong consumer protections, including anti-money laundering (AML) safeguards to help prevent fraud.

AML stands for anti-money laundering. It’s basically a set of laws and regulations to prevent the use of the financial system for illegal activities like terrorism. 

Many reputable companies today rely on quick AML verification services to protect investors from fraud and financial crime. 

Delay Big Withdrawals — and Social Security — If Possible

Waiting even a few years to draw on your retirement accounts or Social Security can dramatically improve your financial outlook. It gives your money more time to grow and shortens the number of years your savings must cover.

• Social Security: Benefits can start at age 62, but waiting until full retirement age (66–67) or even to age 70 increases monthly payments by about 8% per year after full retirement age. In 2025, the projected maximum monthly benefit at age 70 is $5,108 versus $4,018 at full retirement age.
• Retirement accounts: Withdrawing from a 401(k) or traditional IRA before 59½ triggers a 10% penalty plus income taxes.

By delaying, you not only stretch your nest egg but also reduce the risk of outliving your money.

Don’t Overlook Long-Term Care Costs — Health Insurance and Medicare Won’t Cover It

While many people focus on market risk, one of the biggest threats to your retirement savings is the cost of long-term care. Health insurance and Medicare cover only short-term skilled or rehabilitative care — not extended custodial care for help with activities of daily living (ADLs) such as bathing, dressing, personal hygiene, moving around safely in your home, or eating. It also covers the care required for proper supervision if you have dementia.

Longevity and medical advances have made long-term care a big concern. According to the U.S. Department of Health and Human Services, 56% of people who reach age 65 will develop a need for long-term care and/or supervision due to declining memory.

The cost of long-term care services is exploding nationwide. You can search for the current and projected costs of long-term care by using the LTC News Cost of Care Calculator. The cost of extended care services varies depending on where you live, and the calculator is the most comprehensive available, searchable by city or zip code.

Without a Long-Term Care Insurance policy, you will have to use your income and spend down assets to pay for care services or rely on family caregivers, both of which can be emotionally and financially devastating.

• Learn More: Long-Term Care Education Resources

Variety of LTC Insurance Options Available to Protect Assets

A variety of Long-Term Care Insurance policies now exist to help you ensure access to your choice of quality extended care services, including in-home care, and safeguard your savings. Not to mention easing the incredible burden that is otherwise placed on those you love.

The options include:

• Traditional LTC Insurance with monthly benefits for home or facility care.
• Hybrid Life/LTC Policies combine life insurance or annuities with qualified long-term care benefits.
• Short-Term Care Policies for partial coverage or shorter durations.

Education: Long-Term Care Insurance Resources

A qualified Long-Term Care Insurance specialist can compare carriers, policy designs, and underwriting requirements and provide accurate quotes to help you find a plan that fits your budget and health profile.

Plus, there are several tax advantages available when you purchase Long-Term Care Insurance.

Discover: Long-Term Care Insurance Tax Benefits Guide

Experts say that many families learn too late that Medicare won’t pay for extended care. Often, they enter retirement thinking they have a solid plan, only to find that, due to a chronic illness, accident, or the impact of aging, everything changes rapidly.

Planning now protects both your retirement savings and your loved ones, who often become responsible for everything while dealing with their own family and career.

Practical Steps to Start Today

• Review your asset allocation with a fiduciary adviser.
• Max out catch-up contributions if you’re able.
• Delay major withdrawals and Social Security if possible.
• Explore LTC Insurance options while it is most affordable and you have the most available options.
• Use tools like the LTC News Caregiver Directory to find extended care services for a loved one in your area.

Final Thought — Security Is About More Than Money

Protecting your nest egg after 50 isn’t just about balancing stocks and bonds. It’s about ensuring you’ll have quality care, independence, and dignity later in life. By reducing investment risk, planning for long-term care costs, and seeking expert guidance, you give yourself more freedom and peace of mind.

Disclaimer: This article provides general educational information and is not intended as financial, investment, or tax advice.