At 45, retirement stops looking like some distant country on the other side of the map and starts looking like a place that deserves an actual itinerary. That raises an important question: How much money should a 45-year-old have saved outside a 401(k)? There is no magic balance that guarantees a comfortable retirement, but having money beyond a workplace plan can give someone more flexibility when life throws an expensive curveball.
That matters because a 401(k) can do an excellent job growing retirement money while doing a less impressive job as a convenient checking account for life’s surprises. A 45-year-old might need cash for a job change, home repair, career break or an early retirement goal long before a traditional retirement account becomes easy to tap. The goal, then, isn’t simply to hit a particular dollar amount. It is to build different buckets of money that each have a clear job.
