When you are in your forties your earning power should be at it's highest. Possibly by now you're children have left the nest, the house and its contents are almost paid for and you may have climbed the ladder to success in your company reaching a good position in the pecking order.

If you have well now is the time to save in earnest for your retirement. I know it will seem a long way off but I can assure you it will arrive sooner than you think. If you are paying into a private or company pension it would be a good time now to pay a little extra in contributions. Often you can increase your payments with additional voluntary payments.

If you receive bonuses and overtime it would be good to use such extra money to put into a savings account, with a view to investing in something long term such as stocks or shares. Alternatively, or additionally, paying of your mortgage early by increasing those payments can be a load of your mind and save you a lot in interest payments.

Unfortunately with divorce and redundancy there are many forty pluses who are not in such a privileged position .Some will still have young children at home. However I urge you to think of the long term and get yourself a little nest egg set aside whilst you can. As you approach your fifties and sixties your health may decline and your earning potential could fall rapidly. If you are out of work in your late fifties there will be no spare money to save anything with.

If, however, no matter what your circumstances you can plan ahead and save a little you will benefit when you are retired. Making sure your finances are in order and you are using your money wisely is important at this age and time of your life. In your twenties if you have a bad patch you still have time to turn things around. By the time you hit your forties it is really your last chance to begin a pension plan which will have any benefit, and to secure some investments for the future.

Having said all of this, there are people in England, who never work and receive extra help in benefits in retirement which make them better off than some of those who have always worked. Very small private pensions can be a hindrance and actually prevent you receiving the necessary help which you may need. However, government policies are constantly changing and you cannot rely on this. If in your forties you are in a stable position and your income is OK try to plan ahead. If you choose to fritter every last penny, that's your choice, but in the long term it may lead to financial misery.

Learn more about this author, Ethel Smith.
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