As we enter the golden years, preparing financially for retirement is one of the most empowering steps we can take to ensure a stress-free and fulfilling life. For women 50 and older, taking control of your retirement plan now will pay dividends (literally and figuratively) in the years to come. Here are key strategies to help you prepare your finances for retirement.

1. Maximize 401(k) Contributions

If you’re still in the workforce, contributing to your 401(k) is one of the most efficient ways to grow your retirement savings.

• Take Advantage of Catch-Up Contributions: Once you’re 50 or older, you can contribute an additional $7,500 annually (as of 2025) to your 401(k) on top of the standard $22,500 contribution limit.
• Employer Matching: Ensure you’re contributing enough to take full advantage of any employer-matching programs—this is essentially free money for your future.

2. Reevaluate Your Portfolio’s Risk

As retirement nears, the level of risk in your investment portfolio should shift to reflect your changing financial goals.

• Diversify Your Investments: Avoid overexposure to a single stock or sector and instead diversify across stocks, bonds, and other assets.
• Reduce Risk Gradually: Consider reducing the proportion of high-risk investments like individual stocks in favor of more stable options such as bonds or dividend-paying ETFs.

3. Focus on High-Dividend ETFs

Exchange-Traded Funds (ETFs) that focus on high dividends are a great choice for retirement planning. They offer stability, steady income, and reduced risk compared to individual stocks.

• Income Generation: High-dividend ETFs can provide a regular stream of income, which is crucial during retirement.
• Lower Volatility: These ETFs are generally less volatile than growth-focused funds, making them suitable for risk-averse investors.
• If you are unsure how to begin investing, or if you are self-employed, creating a self-directed account with a company such as Stash can help you get started. With low fees, complete transparency, and easy-to-understand ETFs, it is a great way to gain confidence in your financial future.

4. Seek a Trustworthy Financial Advisor

Navigating the complexities of retirement planning can be overwhelming, which is why a knowledgeable financial advisor can make all the difference.

• Choose a Fiduciary: Look for an advisor who is legally obligated to act in your best interest.
• Ask for Transparency: Ensure you understand how your advisor is compensated—whether through fees, commissions, or a combination.
• Plan Regular Check-Ins: Work with your advisor to reassess your financial plan annually to ensure it aligns with your evolving needs and market conditions.

5. Create a Spending Plan

Your post-retirement budget is just as important as your savings strategy.

• Track Your Expenses: Before retiring, identify your current spending habits and project future needs.
• Factor in Healthcare Costs: Medicare won’t cover all medical expenses, so plan for supplemental insurance or out-of-pocket costs.
• Eliminate Debt: Aim to pay off high-interest debt such as credit cards or personal loans before you retire.
• Educate Yourself: Read all you can to increase your financial literacy. Books such as I’ll Teach You to be Rich by Ramit Sethi, or Rich Dad Poor Dad by Robert T. Kiyosaki can help you understand and gain confidence to command a prosperous retirement.

6. Don’t Overlook Social Security

Social Security can be an important part of your retirement income.

• Maximize Benefits: Delay claiming Social Security until age 70 if possible. Each year you delay past your full retirement age increases your monthly benefit by approximately 8%.
• Spousal Benefits: If you were married for at least 10 years and are divorced, you might be eligible for spousal benefits based on your ex-spouse’s earnings record.

Final Thoughts

Financial preparedness is one of the best gifts you can give yourself as you approach retirement. By maximizing your 401(k) contributions, adjusting your portfolio’s risk, focusing on high-dividend ETFs, and working with a trustworthy financial advisor, you’ll set yourself up for a vibrant and worry-free future.

Let me know what works for you or share your own financial tips in the comments below. Here’s to taking the reins of our financial future!

Financial Disclaimer

This article is for informational purposes only and should not be considered financial advice. Please consult with a financial advisor or tax professional before making any financial decisions, as investments involve risk and can result in loss.

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