Turning 50? Avoid These 3 Retirement Savings Mistakes Before It’s Too Late
3 Retirement Savings Mistakes: As you enter your 50s, retirement planning shifts from “someday” to “soon.” This decade often marks the final stretch of your career, making it a critical window to strengthen your financial foundation before stepping into retirement.
Whether you dream of traveling the world, buying a second home, or simply enjoying financial peace of mind, avoiding key mistakes now can make all the difference. Here are three major retirement savings mistakes people in their 50s should avoid next year.
- Overlooking Catch-Up Contributions
One of the biggest missed opportunities for workers over 50 is failing to take advantage of catch-up contributions.
In 2026, retirement savers aged 50 and older can contribute:
• Up to $8,600 to an IRA, including a $1,100 catch-up
• Up to $32,500 to a 401(k), including an $8,000 catch-up
• A special $11,250 catch-up for ages 60–63, raising the 401(k) limit to $35,750
Importantly, you don’t need to be behind on savings to qualify — age alone makes you eligible.
However, higher earners should take note: if you made more than $150,000 in 2025, catch-up contributions in 2026 must go into a Roth 401(k). That means no upfront tax deduction, but tax-free growth and withdrawals later.
If your employer doesn’t offer a Roth 401(k), you could lose this opportunity entirely — making now the time to confirm your plan options.
- Selling Off Too Many Stocks Too Soon
As retirement approaches, reducing risk is sensible but abandoning stocks entirely in your 50s can be a costly mistake.
You may still have a decade or more before retirement, and stocks remain essential for long-term growth. Instead of pulling out completely:
• Gradually rebalance your portfolio
• Shift from high-volatility growth stocks to dividend-paying, stable companies
• Maintain enough equity exposure to outpace inflation
Going too conservative too early could limit your ability to grow your nest egg when it still has time to work for you.
- Failing to Diversify Enough
Trying to “catch up” by betting heavily on a few fast-growing stocks may sound appealing but it’s also risky.
If a single stock makes up a large portion of your portfolio and crashes, you may not have enough time left before retirement to recover. That’s why diversification is crucial in your 50s.
To reduce risk
• Spread investments across multiple sectors
• Avoid concentrating too much money in one stock
• Consider broad options like an S&P 500 index fund for built-in diversification
A well-balanced portfolio can protect your savings while still delivering growth.
Your 50s represent one of the most important decades in retirement planning. Making smart decisions now — and avoiding these common pitfalls can help you retire with confidence and enjoy the lifestyle you’ve worked so hard to achieve. The choices you make today may determine how comfortably you live tomorrow.
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