Wealth

A Woman’s Guide to Growing Wealth in Your 40s, 50s, and 60s

Wealth Growth in Your 40s

Happy mature woman gardener watering plants

In your 40s, you are possibly in a beautiful season of life where you’re hitting your stride at work, making big career moves, or consistently working toward your goals. You’ve likely already started laying the groundwork for a strong financial future. During this decade of your life you can take some key steps to level up. 

Check Your Net Worth

Now is a great time to check your net worth statement and it’s a good thing to recalculate once a year. Total all of your assets such as retirement savings, cash accounts, investment accounts, and stock options, among others. Then, total all of your liabilities such as credit card debt, car loans, and your mortgage. 

Assets – Liabilities = Your Net Worth

The goal is to have your net worth trend upward over time. Ideally, in your 40s, your net worth is positive. You’ve saved or invested enough to start growing your retirement accounts and have paid down most sources of consumer debt. 

Get Clear on Your Goals

You don’t have to know what your day-to-day life will look like in retirement, but it’s good to have a sense of what you’re moving toward. A few general things to consider might be:

  1. At what age and where you’d like to retire.
  2. What type of lifestyle might you want in retirement (an encore career, consulting, volunteering, traveling).
  3. What type of lifestyle goals you have in the near term (selling your home, moving to a different job role or career path, making a major purchase). 
  4. What other financial variables you may need to account for in the meantime (saving in a 529 Plan for a child’s college fund, or financially supporting aging parents).

Set Good Habits

Once you have a clear idea of your net worth and goals, you can create good habits and systems for yourself. These might be:

  1. Setting up annual financial check-ins to track your net worth and progress.
  2. Automate your savings contributions towards your goals – paying down debts, building up savings, and investing.
  3. Check your statements regularly (monthly or quarterly) to make sure you’re spending in alignment with your values and unexpected expenses aren’t creeping up on you.

Lean Into Retirement Savings

Leaning into retirement savings in your 40s can help you set exceptional financial habits while ramping up toward your next chapter. This can look like maxing out your workplace retirement accounts, contributing to a Roth IRA or Roth 401(k), maxing out a Health Savings Account (HSA) or Flexible Spending Account (FSA), and even going beyond traditional retirement savings by opening a brokerage account and continuing to invest there. 

By contributing to your investments early in your career (even small amounts), you’ll have a longer runway for your money to earn compound interest and grow into a sizable nest egg by the time you retire.

Build a Financial Community

Surrounding yourself with friends and family who can hold you accountable and encourage you while you work toward your goals is key. Sometimes just talking about money and financial goals with your spouse, partner, or peers can be immensely helpful in reducing financial anxiety and staying on track.

Focus on Career Growth

Pursue career opportunities – now is the time to grow! Whether it’s a promotion at work or moving to a different company that values your unique skill set, you deserve to flourish and thrive during this season. You can focus on new positions that better align with your long-term career goals or negotiate for better compensation in your current role. The groundwork you lay now can benefit you later on.

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