How to Maximize Your Benefits Before Retirement

Posted October 6, 2025 by

Category: Planning For Retirement, Uncategorized

Key Takeaways:

  • Five to ten years out from retirement is a critical window to boost your retirement savings, implement strategies to manage your tax liability, and identify gaps in your plan.
  • Now is the time to capture every dollar available through your employer’s match, to maximize standard and catch-up contributions, and to leverage tax-advantaged tools, such as a Health Savings Account (HSA) or Roth IRA.
  • Ensure your assets are positioned to promote growth, income, and preservation as you approach retirement.
  • Develop a tax-efficient withdrawal strategy that helps extend the life of your savings while accounting for required minimum distributions (RMDs), unexpected expenses, and medical costs.

If you’re five to ten years out from retirement, it’s a critical time to review your accounts and benefits to help ensure you’re on track. Even small, consistent steps today can make a significant impact on your future security. If you’re in this boat, we’ll share key tips you can discuss with your financial advisor to help ensure you’re saving strategically and well positioned to achieve your retirement goals.

Start Reviewing Your Finances Today

You can still make a meaningful impact at this stage in your planning, but you’ll want to first determine your financial standing.

  • Take Stock of Your Retirement Accounts and Projected Income: Review the balances on your 401(k), IRA, HSA, and investment accounts, as well as stock options, annuities, and other compensation. Consider the different tax treatments of each account, which will affect how and when you make withdrawals.
  • Track Your Current Savings Against Your Saving Goals: Use one of the formulas above to determine if you’re on track, considering your desired lifestyle, anticipated expenses, and new or unexpected expenses related to inflation or long-term care.
  • Identify Gaps that Need Attention Before Retirement: If your plan is on track, think about how you can optimize your savings and income by using tax-efficient strategies or reducing debt. If your plan is falling short, continue reading for ways to help you maximize your savings before retirement

Leverage HSAs for Retirement 

Available with high-deductible health plans, HSAs offer a triple tax advantage. You get a tax break when you contribute, the money grows tax-free, and you can withdraw it tax-free for qualified medical expenses. After age 65, you can use the money in your HSA for other purposes — vacations, daily expenses, or other retirement needs (though you’ll pay regular income taxes on non-medical withdrawals). Here are ways to maximize this tool:

  • Maximize Your Contributions: The regular HSA contribution limits for 2025 are $4,300 for individual (self-only) coverage and $8,550 for family coverage. If you’re 55 or older, you can make an additional catch-up contribution of $1,000 per year.
  • Invest HSA Funds for Long-Term Growth: Once eligible, ensure you invest your HSA funds for long-term growth, considering vehicles like bonds and index funds.
  • Keep Your Medical Receipts: To maximize your savings, you may consider paying out of pocket for medical expenses now and reimbursing yourself later. With the ability to claim reimbursements at any time in the future, this strategy gives your investments more time to compound and grow tax-free.

Make the Most of Your 401(k) Contributions

Your 401(k) is a powerful savings vehicle before retirement. Here are a few ways to ensure you’re capturing all available opportunities:

  • Contribute Enough for Your Employer Match: Check your employer’s matching structure, such as a certain percentage of your income, and ensure you’re contributing enough to capture it. A match is essentially free money, or a guaranteed return toward your retirement.
  • Review Your Investment Mix and Adjust Risk: As you approach retirement, you’ll want to preserve as much of your retirement funds as possible. Review your asset allocation and consider investments that can reduce volatility while still providing growth.
  • Gradually Increase Your Contributions: Even a small increase in your contributions can provide a significant impact in the final years leading up to your retirement. For 2025, the 401(k) contribution limit is $23,000, with a catch-up contribution of $7,500 for those 50 and older. 

Open or Maximize an IRA

An IRA is an additional way to save toward retirement in addition to your 401(k). Here are some factors to consider:

  • Choose Between a Traditional or Roth IRA: Each account has a different tax treatment, which can help you manage your liability in retirement.
    • Traditional IRA: Your contributions are tax-deductible now but are taxed in retirement. If you anticipate being in a lower tax bracket in retirement, this may be a suitable option.
    • Roth IRA: Contributions are made with after-tax dollars (funds you’ve already paid taxes on), with growth and withdrawals in retirement being tax-free. If you anticipate being in a higher tax bracket in retirement, this may be a suitable option.
  • Use an IRA to Complement Your 401(k): An IRA may provide additional investment options than a 401(k), which can help cover the gaps your 401(k) isn’t meeting.
    • The contribution limit for 2025 is $7,000, with an additional catch-up contribution of $1,000 for those 50 and older.
    • Ensure you’re maximizing contributions, or consider strategies such as a backdoor Roth IRA if you’ve exceeded income thresholds.

Take Advantage of Catch-Up Contributions (50+)

Capturing catch-up contributions is a key step to help boost your savings if you started late or simply want to save more before retirement. Here are the catch-up contribution limits for 2025:

  • Retirement Accounts (401(k), 403(b), or IRA): People aged 50 or older can contribute an extra $7,500 to their 401(k) or 403(b) and an extra $1,000 to their IRA.
  • HSAs: People aged 55 and older can make an additional $1,000 contribution annually.
  • Extra Catch-Up Contributions: If you’re 60 to 63, you can make even larger catch-up contributions to 401(k), 403(b), and governmental 457(b) plans. The 2025 “super” catch-up contribution limit is $11,250. 

Develop a Retirement Withdrawal Strategy

Part of retirement preparation involves calculating how much you can safely withdraw each year without running out of money. You’ve already taken stock of your retirement accounts and projected income, forecasting your anticipated retirement income needs and sources — the first step in understanding how much you can safely spend in retirement. Then you can:

  • Create a Smart Withdrawal Sequence: Having money in different “tax buckets,” such as traditional 401(k)s and IRAs (where savings are taxed when withdrawn), Roth accounts (which offer tax-free withdrawals), and regular investment accounts, provides flexibility to control your taxable income each year. For example, in years when you have a lower income you might withdraw more from tax-deferred accounts, while in higher-income years you might lean more on tax-free Roth withdrawals.
  • Account for RMDs: The IRS requires you to take RMDs, mandatory withdrawals, from tax-deferred accounts at age 73 (as of 2025). Think about this as you develop your withdrawal plan to help manage your tax liability (e.g., for increased taxable income) and avoid penalties.
  • Consider Healthcare and Variable Costs: Your healthcare expenses may fluctuate throughout retirement. Ensure you’re building flexibility into your plan to account for costs related to medical expenses, long-term care, or unexpected situations.
  • Make Adjustments as Conditions Change: Market activity, lifestyle changes, or new laws may require you to reassess your withdrawal strategy. Be sure to perform regular check-ins to ensure everything is still aligned.

 Plan Your Retirement with Expert Guidance

This period before retirement is an excellent opportunity to plan proactively, lock in more savings — potentially thousands more — and manage your taxes more effectively later. By understanding where you are and where you’re headed, you can gain more peace of mind that you have financial security and the flexibility to adapt as life changes. 

We love guiding pre-retirees through reviewing their benefits and tailoring plans to their goals. If you want to feel more secure and confident in your next chapter, contact us, and our team of financial advisors will be happy to assist you.

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