Several federal agencies have jointly published a retirement planning guide, including a timeline with important events starting at age 50.
“It is important to start early and be well informed so you can make timely decisions and, if necessary, make changes while you still have time before retirement,” says the “Retirement Toolkit” from Labor, SSA and HHS.
At age 50, for example, it recommends making “catch-up” investments in retirement savings programs such as the TSP. At 59 1/2, there are no more tax penalties on withdrawals from such plans or from IRAs (although distributions still are taxable unless they are from Roth investments), but leaving money in give it more time to grow.
“It is also important to understand how your plan works and what benefits you will receive. Learn about the different features or provisions of your plan. Ask your plan administrator, human resource office, or employer for information. Also learn about the rights and responsibilities you have under the federal law that governs your plan,” it says.
Similarly, Social Security benefits can be collected as early as age 62 but claiming before full retirement age, currently 66, results in reduced monthly benefits. “While you are working, take a look at how much you have saved for retirement, how much you might receive in Social Security benefits, and what other assets you have.”
Well before retirement, it says, examine your living expenses and think about what they will be in retirement. “For instance, your work-related costs will likely go down, while health care costs likely will increase. Starting now can help you make changes while there is time before you retire to make up any savings gap or adjust your goals. Also remember to check your plans at least once a year to see if you need to make changes to stay on track to a secure retirement.