Essential money tips for 50-somethings



Retirement planning is in full swing and the nest may even be empty for those in their fabulous 50s.

Even though some in this age group may find fewer constraints on their hip pockets, financial planning is still key to secure future.

• Part one: Essential money tips for 20-somethings
• Part two: Essential money tips for 30-somethings
• Part three: Essential money tips for 40-somethings
• NEXT MONDAY Essential money tips for people in their 60s

Here’s how to make sure your finances stay fit in your 50s.

Retire well

Planning and saving is key to setting up a quality lifestyle after calling it quits, says Brad Callaughan, director of accountants and business advisors Callaughan Partners.


Kick your retirement saving up a notch. Photo: Shutterstock

“Saving for retirement is the major goal of people in this age group,” he says.

“They start to look at superannuation more closely and are looking at options like self-managed super funds to invest in property and other diversified investment options that they are able to have more control over.

“They are also looking at salary sacrifice up to their age base limit.”

Salary sacrificing could be just the super-pumping fuel you are looking for, says financial planner Andrew Livermore from Monash Wealth Partners.

“Combined with other strategies, salary sacrifice can be even more powerful in boosting your super tax effectively,” he says.

“Consider drawing on other investments to supplement your income so you can sacrifice even more.”

Those aged over 55 can opt to draw a super pension while still working, which allows them to sacrifice more.

Economy strengthening

Staying in control of your finances is crucial. Photo: Shutterstock

Review your risk profile

Check your financial plan to make sure your investments are still on track to meet your goals, says Mr Livermore.

“Over time your goals or attitude to risk may change, therefore your investment strategy may need to change as well,” he says.

“Your investment objectives will determine your investment timeframe. Generally, the longer your investment timeframe, the more aggressive you can afford to be.”

Many in their 50s have built up equity in their property or investment portfolio and can afford to consider borrowing to invest. Mr Livermore says who are thinking about borrowing against their equity should seek professional financial advice.

“While gearing can result in increased returns in a rising market, it may also lead to a greater loss in a falling market,” he says.

“You need to strike a comfortable balance between the level of risk you are prepared to accept and your desired level of return.”

Review your insurance

Keeping an eye on your insurance cover is the best way to make sure you and your family are protected if something unexpected were to happen.

“As your life situation changes, review your cover,” says Mr Livermore.

“Make sure you check your listed beneficiaries and consider updating them every three years.

“Insurance can be sourced through most super funds and from companies outside super. A financial planner can help work out what type of insurance you should have, for what amount, and where to source it.”

Review your Will

State Trustee data shows 50 per cent of Australians don’t have a Will. “Haven’t got around to it”, was the reason cited by 48 per cent of those aged under 50 and 55 per cent of those aged 50 and older.

But it gets harder to ignore this somewhat squeamish issue as you get older.

Having your affairs in order ensures your wishes after death are followed and your family is spared the pain of conflict and confusion.

“Having a valid Will can help make sure your estate is managed and distributed how you intended,” Mr Livermore says.

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