Age-based action steps key for financial planning

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Similar to medical standards of care (For example, having a mammogram starting at age 40, a colonoscopy starting at age 50, and regular blood pressure and bone density tests), certain age-based milestones can tell people the key financial planning action steps that they need to take at different ages.

The following financial activities often take place at various decades of a person’s life:

20s and 30s — Early retirement savings, debt repayment (For example, student loans), and household formation

40s and 50s — Increased earnings, continued wealth accumulation, and launching of adult children

60s — Peak earning years (if still employed), preparation for retirement, and retirement

70s and above — Life transitions (For example, long-term care, widowhood, and death) and wealth distribution

Especially during later life, there are many age-related financial milestones. Examples include eligibility for catch-up contributions to tax-deferred retirement savings plans at age 50, eligibility for early (reduced) Social Security benefits at age 62, eligibility for Medicare at age 65, and required minimum distributions (RMDs) from tax-deferred retirement savings plans at age 70½.

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