As retirement begins to come into view, many families have already built a strong financial foundation. They have saved consistently, accumulated investments, and made progress toward long-term goals. Yet this stage can still feel surprisingly uncertain, because time feels scarce while the questions become more interconnected.
How much should be set aside for college or to help to care for aging parents? How much should go toward retirement? Is it realistic to consider a career change, a major home project, or a meaningful trip? These decisions are deeply personal, with no right or wrong answers. In our experience, the answer is rarely about one decision in isolation. It is about understanding how the pieces fit together.
Peak Earning Years
For many people, their 50s and early 60s are peak earning years, making this an important time to revisit retirement savings. Higher income can create an opportunity not only to save more, but also to be more intentional about where additional savings go.
In 2026, employees can contribute up to $24,500 to a 401(k), with an additional $8,000 catch-up contribution available beginning at age 50. For participants ages 60 through 63, the catch-up limit increases to $11,250. Recent changes under SECURE 2.0 also affect how some higher-income workers make catch-up contributions, creating another reason to review retirement savings choices each year.[1]
For some households, a mix of pre-tax and Roth contributions can provide valuable tax diversification. While contributing to a Roth 401(k) does not reduce current taxable income, all qualified withdrawals in retirement are tax-free. Having assets with different tax characteristics can provide powerful flexibility when managing taxable income later in life.
Balancing Retirement and College
Few financial decisions feel more personal than choosing between saving for your own retirement and helping your children pay for college. Most parents aim to fully fund their children’s college education, but paying for college should not come at the expense of planning for their own long-term financial security.
Families have several ways to manage college costs, including savings, current cash flow, scholarships, financial aid, and borrowing. Retirement offers far fewer alternatives. For that reason, we generally recommend making sure your own retirement plan remains on track before committing additional resources to education costs.
As college approaches, it is also worth reviewing how education savings are invested. Funds that will be needed within the next several years generally should not carry the same level of investment risk as money intended for a much longer time horizon. Strategically reducing risk can help improve the odds that the money will be available when tuition bills arrive.
Planning for the Unexpected
While retirement and college expenses are often planned over many years, less predictable expenses also arise suddenly during this time period. The decade before retirement is often one of the most expensive periods of life. Overdue home repairs, unforeseen health issues, and new time demands from aging parents may arrive just as families are trying to accelerate retirement savings. Maintaining adequate cash reserves provides flexibility when these expenses arise and helps prevent short-term needs from disrupting your long-term plans.
Rather than viewing cash simply as an emergency fund, it can be useful to think of it as a source of liquidity that creates options when life does not unfold exactly as expected. A useful starting point is three to six months of expenses in emergency savings, though the appropriate reserve will vary by household. Income stability, upcoming expenses, and personal comfort with uncertainty should all factor into the decision. Cash intended for near-term needs is generally best held somewhere liquid and low risk, such as a high-yield savings account or similar vehicle.
Invest in Living
Financial planning should not focus exclusively on saving for retirement. It should also help you understand what you can comfortably spend along the way. It can mean helping an aging parent, changing careers, or breaking ground on a long-planned home project. It can also mean saying yes to an extended family trip before the kids leave home. Creating memories with your teens can be worth every penny at a stage when connection and communication can feel like a struggle.
During these in-between years, a personalized financial plan can give you confidence and clarity about your long-term security, while still making room for the people, experiences, and priorities that matter today.
Resources:
[1] Treasury and IRS issue final regulations on new Roth catch-up rule, other SECURE 2.0 Act provisions. IRS.gov
