If you’re 50 or older, you can contribute up to $7,000.
But if you’ve maxed out your Roth IRA and still need to get to 15%, then go back to your 401(k) and invest the remaining amount.
And if those options aren’t available to you, or you need another way to reach 15%, then open a taxable investment account like mutual funds – and let it do its thing.
Investing by Age
Anyone can do this. Remember, your saving and investing strategy will secure your financial future.
All it takes is discipline, focus, and the ability to pay off debt, budget, and save money.
But what does that look like in your 20s, 30s, or even 60s?
Here’s my list of the smartest moves for every age.
If you’re behind in the game, use that as fuel to work harder to reach your goal. It’s never too late.
20s – Laying the Groundwork
Are you newly married or about to be? Start having conversations about money and get on the same page as your spouse.
Avoid debt like the plague. No credit cards, car payments, or financing furniture. And yes, 0% financing is debt too.
If you have student loans, focus on getting them paid off quickly. I recommend using either the debt snowball or debt avalanche method.
Get good medical insurance. A single hospital stay can bankrupt you in a heartbeat.
30s – Building the Foundation
If you’re planning on having kids soon, make sure to budget for diapers, daycare, car seats, and other things.
Buy enough term life insurance to cover your family should anything happen to you or your partner. We recommend getting 10 times your income. Learn why and get a free instant quote.
Make sure you’ve built up your emergency fund to cover at least 3-6 months of your household expenses.
If you’re planning on buying a home, make sure to save 10-20% for a down payment at a 15-year fixed interest rate. (Also keep your house payment less than 30% of your take-home pay.)
40s – Put the Savings Into Overdrive
You’ve made progress in your career, and your kids are out of diapers. This means there’s a little more money in hand to invest.
Start putting money into your kids’ college funds.
Stay out of debt, and keep maintenance going on your home and car to avoid costly repairs down the road
50s- Get Excited But Stay Focused
You’re starting to look forward to a life without those long work shifts. Your saving and investing strategy is starting to pay off.
It’s good to feel excited. But don’t cash in your retirement savings just yet—keep investing a full 15%.
Now’s the time to focus on paying off your mortgage early. If your kids are out of the house, maybe you can downsize and pay cash for your next home.
60s – Enjoy it!
It’s time to retire! Woohoo! But that doesn’t mean being a couch potato. Find ways to stay active and tweak your budget!
The day you turn 60, buy long-term care insurance. A few years of long-term care can suck your life savings dry. So prepare in advance.
Enjoy yourself! With a paid off mortgage and an empty nest, you can focus on fun: traveling, visiting grandkids, and donating to charity.
Final Thoughts
Remember, this is a marathon, not a sprint. It takes patience, focus, and long-term investing to win with money.
So keep moving forward. You’re doing something now that you’ll thank yourself for later.
Create strong financial goals and constantly remind yourself of the importance of savings and investment.
If you want to learn more about retirement (you should) then I recommend picking up Chris Hogan’s book, Retired Inspired.
It’s a great beginners guide for retirement. You’ll be glad you did.