Direct answer: The annual investment review for investors ages 40-49 covers: confirm 401(k) contribution is at the annual limit, plan for catch-up contributions starting at age 50, confirm Roth IRA or Backdoor Roth is funded, confirm HSA is maxed, review 529 balance against college funding projections, check life and disability insurance adequacy, verify estate plan documents are current, assess employer stock concentration, and calculate total investment assets as a multiple of annual income to assess retirement readiness.

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The Annual Investment Review Checklist for Ages 40-49

The Annual Checklist

  1. 401(k)/403(b) contributions: Confirm current contribution rate will reach the annual IRS limit ($23,500 in 2026 for those under 50). If not, increase the rate.
  2. Catch-up contribution planning (ages 48-49): Confirm you know the catch-up limit that applies starting at age 50 ($7,500 in 2026, for a total 401(k) limit of $30,500). Plan the budget to accommodate this increase.
  3. Roth IRA or Backdoor Roth: Confirm the annual IRA limit is funded ($7,000 in 2026). If above the direct Roth income limit, confirm the Backdoor Roth steps were completed correctly.
  4. HSA maximum: Confirm HSA contributions reached the family limit ($8,550 in 2026) or individual limit ($4,300). Confirm HDHP enrollment for the next year.
  5. 529 vs. projection: Calculate current 529 balance against expected college costs at the child's enrollment date. Increase contributions if the gap is large.
  6. Life insurance: Confirm coverage amount is adequate for income replacement. A common guideline is 10-12 times annual income for the primary earner. Review both term and any employer-provided coverage.
  7. Disability insurance: Confirm long-term disability coverage is in place, replacing at least 60% of income. Short-term disability coverage through employer supplemented by the emergency fund.
  8. Estate plan currency: Confirm will, trust, powers of attorney, and healthcare directives are current. Confirm all beneficiary designations match current intent.
  9. Employer stock concentration: Calculate what percentage of total investment assets is in employer stock. If above 5-10%, plan a systematic diversification schedule for the coming year.
  10. Total investment-to-income ratio: Calculate total investable assets divided by current gross income. Common guideline: 3x at age 40, 4.5x at age 45, 6x at age 50. These are guidelines, not guarantees.

How to Know If You're on Track at Age 45

Retirement readiness benchmarks are rough guidelines, not precise targets. A commonly cited framework (Fidelity's approach) suggests having approximately 3x salary saved by age 40 and 6x salary by age 50. A more personalized check: model your expected Social Security benefit (create an account at ssa.gov to see your earnings history and projected benefit), estimate your desired annual retirement spending, and calculate how large a portfolio you need to sustain that spending for 30 years at a 4% withdrawal rate. The gap between current savings and the target is what needs to be filled by continued contributions.

Frequently Asked Questions

How do I know if I'm on track for retirement at age 45?

Three steps: (1) Check your projected Social Security benefit at ssa.gov by creating an account and reviewing your earnings history. (2) Estimate your annual retirement spending (many planners use 70-80% of pre-retirement income as a starting point, adjusted for your actual expected lifestyle). (3) Calculate the portfolio size needed: annual spending divided by 0.04 (the 4% withdrawal rate guideline) gives you a rough target. Compare your current total investable assets to that target. The shortfall, combined with future contributions and expected growth, determines whether you are on track. A fee-only financial planner can model this more precisely.

What is the 401(k) catch-up contribution limit at age 50?

In 2026, the 401(k) catch-up contribution for those age 50 and older is $7,500, in addition to the standard $23,500 employee contribution limit, for a total of $30,500. The IRA catch-up for those 50 and older is $1,000 above the standard $7,000 limit, for a total of $8,000. These limits are set by the IRS and adjusted periodically for inflation. Check IRS.gov for current year limits before planning contributions.

Should I have a target retirement portfolio size?

A target range is more useful than a single number, because it depends on your expected spending, Social Security benefit, other income sources, and tax situation. A rough approach: multiply your expected annual retirement spending by 25 (the inverse of the 4% guideline). If you expect to spend $80,000 per year in retirement and Social Security covers $25,000, you need your portfolio to cover $55,000 per year, which implies a portfolio of approximately $1.375 million ($55,000 divided by 0.04). Work backward from that target to confirm your current savings rate and growth assumptions put you on a path to reach it by your retirement date.