40-Something Financial Checklist

Compared to financial goals in your 30s, your 40s become less about establishing your financial goals and more about developing the right financial strategies to help meet your unique situation. Careers are taking off, kids are keeping you busy, and your parents may start to rely on you more than before.

Juggling priorities can often take a toll on you and that’s why now is the best time to make sure you are doing all you can to be strategic about your money and optimize your financial situation.


What you want in your 50s and 60s is largely dependent on what you do in your 40s.

Although your overall situation may be a bit more complex than it was in your 30s, some of the basics don’t change – balance your budget, pay down high-interest debts, keep an emergency fund. Beyond that, it’s time to start focusing on some of your bigger financial goals.


The 40-something checklist


    • Set specific goals (and costs) for the next 10 years
  • Prioritize your most important goals and start tracking them

Savings & Investing

    • Invest outside of retirement accounts
    • Adjust your asset allocation


  • Look into long-term care insurance


    • Refinance your mortgage
  • Talk to your parents about their money


Goal Setting

Set goals

Ask yourself, “am I putting money towards my most important goals?”. Whether it’s a cabin in the mountains or an early retirement, make a list of what you want to accomplish in the next 10, even 20 years. The sooner you start making a plan to reach these goals, the more likely you are to achieve them.

Start Prioritizing

You will often have goals that compete with each other over similar time frames, so start thinking about the best ways to prioritize these. Once you have decided what goals are most important, focus on the tools and options available to achieve them. These can vary from investing more aggressively to postponing the goal.


Savings & Investing

Max out retirement accounts

How you save during your 40s largely determines what your retirement will look like. If you’re not doing so already, work towards maxing out your employer 401(k) as well as an IRA. The tax benefits of retirement accounts make them extremely useful and therefore should often be prioritized over other savings vehicles.

Invest outside your retirement accounts

Once you have maxed out your retirement accounts, look to invest additional dollars in a brokerage account.

Adjust your asset allocation

Make sure that the risk you take on is aligned with your risk capacity and risk tolerance. In other words, how much investment portfolio loss can you handle emotionally AND financially, within the time horizon of your goals. Remember, the way you invest for 5 years is very different from the way you invest for 20 years. As goals get closer, look to adjust your asset allocation so that you are not taking on as much investment risk

Utilize employer benefits

In addition to employer retirement accounts, make sure you are taking advantage of all the applicable benefits your employer offers you. Health savings accounts (HSAs) are a great way to put money aside for health expenses. Employer stock option plans (ESOPs) are a benefit offered by some employers, which allow you to buy company stock, often at a discount.

Save for children’s college

Saving for a child’s college is a common goal of many parents. Consider saving into a 529 plan that offers tax benefits.



Create or update estate plan

Even though this might not be top of mind, make sure you have an updated estate plan. Review beneficiaries, will, trust, and powers of attorney to make sure they are still appropriate. This is especially true if you’ve recently married, had kids, become part of a blended family, started a business, or received an inheritance.

Life insurance

You may already have some life insurance, but if your needs have changed since you purchased it, now is a good time to review your coverage to make sure you have enough protection.

Disability insurance

Let’s say you were in a car accident and were unable to work for 6 months. How would you pay your expenses? Disability insurance is a type of insurance that looks to replace a portion of your income in case you are unable to work. A disability includes an accident or illness both during and outside of work. Check with your employer to see if they offer this type of coverage or look to get a private policy in place.

Long-term care insurance

Most people will require care at some point in their lives. Depending on your current and future financial situation, it might be a good idea to look into long-term care insurance (LTC) to avoid having to cash out savings to afford it.



Refinance your mortgage

As most Americans in their 40s, your mortgage is probably your biggest monthly expense. If you have a good credit score and the 30-year mortgage rate has gone down at least 1% since you bought the home, refinancing can be a great way to save month each month. If you bought your house before 2010 and haven’t refinanced yet, there is a good shot you can save money by refinancing at today’s rates.

Talk to your parents about their money

Being in your 40s likely means that your parents are in their 60s or 70s. Although they may still be independent and not thrilled at the idea of discussing their finances with you, it is important to have the discussion before they are no longer able to care for themselves. Make a list of all the things you need to discuss and start preparing for any issues that could arise.


Consider working with a financial planner

Great financial advice should cost you much less in the long term than no advice at all. Aside from the costs of time and energy that go into managing your finances, the opportunity costs of not making the right financial decisions, in the long run, can be large. Working with an experienced financial advisor is no different to working with a top personal trainer in ensuring that you’re doing everything you can to reach your goals.

With Zoe you have access to the top 5% of advisors in the USchat with us today about finding the right person for you.

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