4 Steps to Building Wealth in Your 50s

Turning 50 often marks a turning point in your financial life. Your children may be becoming independent, and you may be reaching some of your highest earning years. With retirement drawing closer, this is an important time to strengthen your savings and refine your long-term strategy. Whether you’re catching up or continuing consistent contributions, there are steps you can take now to improve your financial outlook.

A financial advisor can help you build a plan tailored to your goals and priorities in your 50s and beyond.

1. Leverage All of Your Savings Options

While a 401(k) (or another employer-sponsored plan) is a good first stop for retirement savings, it’s not the only way to build your nest egg. Once you’ve maxed out your employer’s retirement account, you can supplement it with an IRA.

For 2025, the regular contribution limits for a 401(k) and IRA are set at $23,500 (up from $23,000 in 2024) and $7,000 (unchanged from 2024), respectively. If you’re age 50 or older, you can also make catch-up contributions of an additional $7,500 to a 401(k) and $1,000 to an IRA.

For 2026, the 401(k) contribution limit increases to $24,500, while the IRA contribution limit rises to $7,500. Catch-up contributions remain $8,000 for 401(k) participants age 50 and older, and increase to $1,100 for IRA savers age 50 and older.

Under a provision of the SECURE 2.0 Act, savers between ages 60 and 63 can make enhanced “super catch-up contributions.” This allows an additional $11,250 catch-up contribution in 2026.

In addition to workplace retirement plans and IRAs, health savings accounts (HSAs) offer another tax-advantaged way to save. For 2025, HSA contribution limits are $4,300 for individual coverage and $8,550 for family coverage, with an additional $1,000 catch-up contribution available for those age 55 or older. For 2026, these limits increase to $4,400 for individuals and $8,750 for families, with the catch-up contribution remaining $1,000. Once you turn 65, you can withdraw HSA funds penalty-free for any purpose, although non-medical withdrawals are subject to ordinary income taxes.

2. Be Strategic About Paying Down Debt

A couple reviewing the debt they need to pay down.

Carrying credit card balances, student loans or mortgage debt into retirement is a risky move, especially if you know that your income is going to go down once you’ve stopped working. In your 50s, it’s best to focus on eliminating as many of your financial obligations as possible so you can head into your golden years with a streamlined budget.

That being said, there are some rules to follow when it comes to paying off debt. Before you begin making your monthly payments, it’s important to make sure you’re maxing out your retirement accounts. At this stage in life, you can’t afford to delay your savings.

While you’re paying down your debts, you can tackle the ones that are costing you the most first. Then you can look for ways to make your other payments less expensive. If you have credit cards, for example, transferring them to a card with a lower rate can potentially save you some money on interest. If you’re thinking of refinancing your mortgage, it’s best to run the numbers to get an idea of what you can save.

3. Manage Risk Carefully

Putting your money in a savings account may give you a sense of security but it’s not going to make you rich. Investing in stocks and mutual funds means taking a bigger gamble, but it can generate substantial returns in the long run.

If you’ve been fairly aggressive about investing up to this point, you may need to rethink that strategy. Someone who’s in their 30s and has years to go before they retire is in a better position to rebound from a market decline than someone who’s in their mid-50s.

That’s why it’s a good idea to take a look at your portfolio’s asset allocation to see where your money is concentrated. If you’re still investing heavily in stocks, now’s a good time to begin easing towards more conservative investments. You may see your returns reduced slightly but the trade-off is that you’ll be better insulated against market volatility.

4. Increase Your Retirement Savings Rate as Your Income Peaks

Many people reach their peak earning years in their 50s, which creates an opportunity to accelerate wealth building. If your income has increased over time, consider raising your retirement contribution rate accordingly. Even small percentage increases can make a meaningful difference over the final decade or two before retirement.

One effective strategy is to direct raises, bonuses or other unexpected income toward retirement savings rather than increasing spending. For example, increasing your 401(k) contribution from 10% to 15% of your salary could add tens of thousands of dollars to your portfolio over time, depending on your income and investment returns.

If you’ve already maxed out your tax-advantaged accounts, you can continue investing through a taxable brokerage account. While these accounts don’t offer the same tax benefits as retirement plans, they provide flexibility and can help supplement your retirement income later on.

Making retirement savings a higher priority during your peak earning years can help close any gaps and strengthen your financial position before you stop working.

Bottom Line

Building wealth is something just about anyone can do with enough time and the right tools. If you’re in your 50s, your retirement is probably not too far away. But it’s not too late to create a comfortable financial cushion for your 60s and beyond.

Tips for Smarter Money Management

It’s never too late to revisit your monthly finances. To get a holistic picture and understand where you might be able to cut or save more, use our free budget calculator and run your own numbers.
If you’re not sure how to get started or you need some more guidance, consider working with a financial advisor. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.