By avoiding these, you may be able to avoid future financial crises.
IRS increases 401(k) contribution limits for 2026
The IRS will increase 401(k) and catch-up contribution limits for 2026, allowing workers to save up to $32,500 for retirement.
Your 50s are a pivotal time in the grand scheme of saving for retirement. At that point, you may be very close to the end of your career. You may also have big plans for your senior years, like travel, a vacation home on the beach, or something else you’ve always wanted.
It’s important to make the most of your last 10 years so you can start your retirement on the right foot. Here are three retirement savings mistakes you should avoid next year if you’re in your 50s.
1. Forgetting that you can make a catch-up contribution
Making catch-up contributions to your IRA or 401(k) is a great way to increase your retirement savings. You also don’t have to put your savings in arrears to take advantage of catch-up contributions. All you need to do is be over 50 years old by the end of the calendar year.
In 2026, IRA savers age 50 and older can make an additional contribution of $1,100, bringing the total allowable contribution to $8,600. If you have a 401(k) plan, your catch-up contributions total $8,000, giving you a total of $32,500 to contribute next year.
Additionally, for 401(k) savers between the ages of 60 and 63 in 2026, there is a special retroactive contribution of $11,250 instead of the $8,000 mentioned above. For people in this age group, the maximum 401(k) contribution in 2026 is $35,750.
Note that if you earned more than $150,000 in 2025, your only option for making 401(k) catch-up contributions in 2026 is a Roth 401(k). This means you will lose the tax break on the money you put into savings, but you will still be able to enjoy tax-free gains and withdrawals in return.
However, if your employer doesn’t offer a Roth option in your 401(k), you may not be able to make additional contributions. Now is the time to determine if that option is available to you and make a plan.
2. Selling too many stocks
As you near retirement, it’s a good idea to start removing risk from your portfolio. But one thing you don’t want to do is give up too many stocks in your 50s, when you may still have quite a few years left before your career ends.
What you should do is take a look at how much you have invested in stocks and decide whether it would be beneficial to scale back a bit. If you want to reduce your risk, you can also replace some growth stocks with more stable dividend stocks.
3. Not diversifying your portfolio enough
If you’re looking to successfully grow your savings as you approach retirement, or if you’re playing catch-up to catch up on years of not saving, you may be more inclined to invest your money in some high-potential growth stocks. It’s easy to see why it’s appealing. But another big mistake you don’t want to fall victim to is not broadening your portfolio.
If you invest 20% of your assets in a single stock that crashes in value and never recovers, you may not have enough time to recover those losses before you retire. So it’s a good idea to continue investing in stocks into your 50s, but be sure to invest in a variety of market sectors. Also, if you are not sure whether the business is sufficiently developed, you can always buy shares. S&P500 Index funds for further diversification.
Your 50s is an important time to think about your retirement plans. If you can avoid these big mistakes, you’ll be able to retire more confidently and do all the things you’ve always dreamed of doing.
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