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Eight steps to take when you're 20 years from retirement

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(Read caption) Retiree Jerry Hallman talks about water quality and the Colorado River Municipal Water District in Big Spring, Texas on Tuesday, March 11, 2014. Even in retirement, Hallman continued to enjoy an active lifestyle.

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Even though retirement is still 20 or more years away for workers in their 40s, it’s a critical time in planning for their future needs.

For most people, the 40s mark the beginning of their prime earning years. At the same time, they may face mounting expenses at home. Paying for their children’s education becomes a major consideration, as do the financial and other responsibilities they may take on for their own aging parents.

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As the prospect of retirement begins to seem more realistic — rather than like some far-off event — it’s crucial to determine whether you are on track with your planning. If not, you won’t have as much time to correct course as will people in their 20s and 30s. Sadly, many of your peers have not started planning at all; they aren’t yet thinking seriously about how to balance future needs with current needs.

Fortunately, when you’re 20 years from retirement, you’re still in a good position to institute changes that can make a big difference. The National Association of Personal Financial Advisors recently compiled its best advice for this group.

Here’s the group’s list of the eight things that you should be addressing today if your retirement is 20 years away.

1. Fully fund an emergency account of three to six months of living expenses to avoid tapping into your 401(k) or home equity in the event of an emergency.

2. Boost your earning potential and benefits package now by contributing the maximum annual amount to your 401(k), or at least enough to receive a full employer match.

3. Contribute money to a Roth IRA, if you’re eligible, or other account to make sure you are saving in a tax-optimized manner.

4. Coordinate your insurance needs with your employer’s benefits package to be sure you have adequate coverage should you become disabled (long-term disability) and evaluate the level of life insurance you need.

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5. Ensure you have a diversified investment portfolio so that you are investing for growth, and create tax diversification by allocating assets across taxable, tax-deferred and tax-free sources. Consolidate multiple retirement accounts and/or brokerage accounts you may have.

6. Make sure you have basic estate planning documents in place (i.e., a will, power of attorney, possibly a revocable trust, a living will, a health care proxy).

7. Set a benchmark “magic number for an adequate retirement fund and establish a step-by-step plan for reaching your goal.

8. Do not sacrifice your retirement to put your children through college. It is possible to take out loans for college but not for retirement.

Do not procrastinate about planning for your retirement. You still have time to make significant progress in your 40s. But the longer you wait, the more your odds of a successful retirement begin to diminish. If you need help getting on track, do yourresearchask questions and consider working with a NAPFA advisor.

This article first appeared at NerdWallet.