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At age 50, what should my retirement portfolio look like? What should my 401(k) and savings account balances be?

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  Answers  |  1

August 01, 2018

You might find numbers floating around out there with how much you should have saved at a certain age. While that may be helpful as a guide, the reality is that everyone's financial needs and circumstances are different. For someone who has a strong pension, no mortgage and no other debt, the real number may be very different from someone with no pension and lots of expenses.
Regardless of where you should be, the first question to look at is where are you today, since we cannot go back and change the past anyway.
Look at your expected fixed income in retirement such as Social Security, pensions, rental income, etc.
Now look at your estimated expenses in retirement. Start with the essential expenses such as your mortgage or rent, utilities, food, etc., and then add lifestyle expenses such as dining out, clothing, travel etc.
Once you know what your shortfall or surplus looks like, you will have an idea of the basic monthly income you will need from your investments and retirement accounts. Of course, there are other areas to consider such as cost for health care, Long-Term Care, and the bigger purchases in life like replacing your car or fixing the roof on your home.
At this point, taking the time to consult with a financial advisor may be a great idea. Depending on your investment style, risk tolerance and time horizon, you can calculate how much money you will need to meet your goals. If you are short, you will be able to calculate how much you need to continue to contribute to your retirement and investment accounts, as well as for how long you should continue to work and continue your contributions to retirement accounts.

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