Financial Planning for Older Families and Empty Nesters: Strategies for the Years Ahead

Article overview

• Smart retirement planning: Focus on reviewing retirement accounts, utilizing catch-up contributions and adjusting your strategy for long-term financial security. Explore options like Roth conversions and rebalancing investments to maximize savings.
• Balancing family needs: Address financial challenges of the “sandwich generation” by creating strategies to support aging parents and adult children while maintaining boundaries to protect your future finances.
• Health, housing and estate planning: Prepare for rising healthcare costs by considering HSAs and long-term care insurance, review whether downsizing or staying in your home makes sense, and update your estate plan to reduce stress for loved ones and align with your goals.

This article is the fourth in the Financial Planning for Every Stage of Life series.

As your kids grow up and you enter the later stages of your career, financial priorities can shift. Financial planning for older families and empty nesters is about preparing for what’s next, whether that’s retirement, supporting aging parents or helping adult children.

A few intentional steps now can help you feel more stable, flexible and ready for the years ahead. This stage doesn’t mean you’re starting over. However, you can examine how and where to adjust your strategy to protect what you’ve built and make informed decisions for the future.

You’re getting serious about retirement

Retirement may be years away, but this is the time to start shaping what it could actually look like. Financial planning for retirement in your 40s and 50s can begin with saving, but ideally, you should consider setting a clear vision and identifying the income sources you’ll rely on.

Start by reviewing your Social Security estimates. According to the Social Security Administration (SSA), the average monthly benefit in 2025 is just over $2,000. Then check your 401(k), IRA and pension balances to see if they align with your timeline. If not, there’s time to adjust.

You don’t have to have it all figured out today. But knowing your future goals can help you move forward with some clarity.

You’re reviewing retirement accounts and catch-up options

Once you’re in your 50s, saving for retirement can start shifting from “someday” to “soon.” This stage of retirement financial planning is where you can focus on making the most of every remaining year you have left in the workforce, especially if you’re playing catch-up.

There are a few ways to contribute more to your retirement savings in 2025:

• The 401(k) contribution limit is $23,500, with an additional $7,500 in catch-up contributions for those over 50.
• If you’re between 60 and 63, that limit jumps to $11,250.
• IRA contribution limits are $7,000, plus a $1,000 catch-up contribution.

As you review your plans, consider working with an accountant or financial planner to review your options, such as a Roth conversion, rebalancing investments or consolidating older plans. There’s still time to make adjustments that can help you build momentum and maximize savings while you’re still earning.

You’re balancing support for kids and parents

More than half of Americans in their 40s and 50s are part of the “sandwich generation,” caring for aging parents while supporting older children. Over 70% of parents in this age group have provided financial support to their grown children, and 43% are also managing elder care costs that continue to rise.

These uncertainties can cause financial stress and take a toll on your savings. Here’s where you may need to create a strategy that factors in these responsibilities and set clear financial boundaries, where possible. Planning at this stage of life can often include balancing generosity with sustainability so you can continue helping those you love without putting your future at risk.

You’re adjusting to an empty nest

When your kids move out, your monthly expenses may change, but so should your financial strategy. This would probably be a good time to reassess your goals and shift focus towards building long-term stability.

Financial planning for empty nesters can involve updating your household budget, redirecting extra funds toward retirement or tackling debt more aggressively. It may also be the right time to review your insurance coverage, drop unnecessary expenses or consider whether your current home still fits your lifestyle. Downsizing or refinancing can free up income for savings or debt repayment.

These updates can help you realign your spending and savings with what matters most moving forward.

You’re managing health care costs and medical debt

As you age, health care often becomes a bigger part of your financial picture. In 2025, one-third of adults reported delaying medical care or borrowing money to pay bills. Older adults are especially vulnerable, with medical debt as a top concern.

Some options to consider:

• Review your current health insurance coverage and, if eligible, consider contributing to a health savings account (HSA).
• Look into long-term care insurance or evaluate what out-of-pocket costs could look like in retirement.
• Plan on future medical expenses, including premiums, prescriptions and unexpected bills.

Planning ahead can help prevent unexpected medical expenses from disrupting your broader financial goals. 

You’re updating your estate plan

Financial lives can become more complex as you age, so an estate plan may help. An estate plan uses legal tools, such as wills, healthcare directives and powers of attorney, to help manage complexity by clearly outlining how your assets, healthcare decisions and responsibilities should be handled if you’re unable to make decisions on your own or after you pass away.

This may also be a good time to review account beneficiaries for your retirement funds and life insurance policy, especially if you haven’t updated your plan since your kids were minors or your assets have changed. Review what would happen to your home, retirement accounts and other investments if your family lost your income.

An updated plan can help reduce stress for your loved ones and make sure your goals are carried out. A financial advisor or estate attorney can help you make decisions that match your situation. 

You’re deciding what to do with your home

For many older families, your home is your biggest financial asset and a major consideration in long-term planning. As your needs change, it’s worth considering whether your current space continues to meet your needs.

Downsizing could lower expenses and free up equity, while renting might offer more flexibility. On the other hand, staying put could make sense if your mortgage is paid off or you plan to age in place. If you’re thinking about downsizing, consider the long-term costs of maintenance, taxes and potential accessibility upgrades as you weigh renting vs. buying a smaller home.

Your housing decision plays a significant role in financial planning for retirement, especially if you want to simplify or strengthen your financial decisions.

Refining your financial future

Your 40s or 50s may be the right time to reassess your financial strategy. The choices you make today about savings, caregiving, housing and healthcare can shape how secure and flexible you feel as you approach retirement. You don’t need to solve everything right now, but with a clear plan, you can move into this next phase with more confidence and control.