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Yahoo
2 days ago
- Business
- Yahoo
Suze Orman: 3 Retirement Curveballs To Watch Out For
Most people don't know how long they'll live or what their old age will look like, and there's no shortage of brutal realities. For example, most people will have to reduce or all together stop driving by their mid-70s. Additionally, the lifetime risk of dementia increases to over 50% among those who reach age 75. And most people are likely to develop a condition requiring long-term care in their senior years. You can hope for the best, but you have to prepare for the worst. Find Out: Read Next: In a recent post on her blog, financial expert Suze Orman discussed three common retirement curveballs. Even if you're lucky enough to dodge these curveballs, you need to know what they are and to stress-test your retirement plan to make sure that if you are struck, you — and your finances — can handle it. This year's Retirement Confidence Survey by the Employee Benefit Research Institute found that 3 in 4 people working expect to go on to continue to earn money in retirement. But that doesn't usually happen. 'In reality, only three in 10 people surveyed who are retired are working for pay,' Orman wrote. The top reason retirees opt to go back to work is to be able to make money amid rising costs of living. But what if you physically or mentally can't return to a working lifestyle? Around 46% of Americans ages 75 and older and 24% of those ages 65 to 74 reported having a disability, according to estimates from the Census Bureau's 2021 American Community Survey (ACS). Who's to say that you won't be among the Americans who have a disability in retirement, and one that renders you unable to generate income? Be Aware: Maybe you're set on retiring at the full retirement age of 66 or 67, depending on when you were born. Maybe you're thinking you may even push it back a couple years to make some more money before you bid adieu to working life. Consider the cruel possibility that you may not have a choice but to retire early. 'About two-thirds of people surveyed who reported they retired earlier than planned said it wasn't their idea,' Orman wrote, citing data from the Retirement Confidence Survey. 'About 30% said they stopped working due to downsizing or other strategic staffing changes at their job, and another 30% had a health problem or disability that pushed them to retire early. Some people reported stopping work earlier to care for a spouse or another family member.' Do you want to sail smoothly into retirement? Maybe do leave the full-time hustle and bustle but work as a consultant for a few years before exiting the workforce? Well, yet another brutal reality could strike. A bad health event or some other serious situation in your life may force you to pull the plug fast on the working life. 'Half of the surveyed workers said they plan to have a gradual transition to retirement where they have reduced hours, rather than a cold-turkey full-time stop,' Orman wrote. 'Yet nearly 3 in 4 retirees said they, in fact, didn't have the gradual transition, and instead did an abrupt change from working on Friday and being retired on the following Monday.' They're called curveballs because we don't see them coming. But that doesn't mean we can't prepare for them so that if they do hit us, we're not taken down with them. More From GOBankingRates Clever Ways To Save Money That Actually Work in 2025 This article originally appeared on Suze Orman: 3 Retirement Curveballs To Watch Out For
Miami Herald
4 days ago
- Business
- Miami Herald
Tony Robbins sounds alarm for Americans on Social Security
An important report reveals that many Americans feel unprepared for retirement - a reality that personal finance author Tony Robbins considers urgent. Robbins believes the path toward catching up on tools such as 401(k) savings and IRAs (Individual Retirement Accounts) begins with an essential but often-overlooked move: taking ownership of one's financial future. Don't miss the move: Subscribe to TheStreet's free daily newsletter While nearly 88% of working Americans foresee Social Security playing at least a partial role in funding their retirement, the typical monthly benefit of around $2,000 is unlikely to support the lifestyle most retirees envision. That gap pushes many to count on alternative streams of retirement income. A significant portion of workers plan to rely on other sources: 84% anticipate using workplace-sponsored retirement plans such as 401(k)s, 77% expect to lean on personal savings and investments, and 68% look to Individual Retirement Accounts (IRAs) as additional lifelines, according to the Employee Benefit Research Institute. This diversified approach is crucial, as depending solely on Social Security will not suffice, Robbins notes. Related: Shark Tank's Kevin O'Leary warns Americans on 401(k)s Robbins emphasizes his view that it's time to stop sidestepping the facts. Many have yet to take that first serious step - building a solid savings and investment strategy. As retirement looms, especially for those still trying to catch up, swift and deliberate planning becomes essential. Getty Robbins is vocal about the risks of depending too heavily on Social Security for retirement. In his view, it's a grave misstep to assume those benefits will be enough to sustain most people in their later years - especially with longer life expectancies stretching the cost of retirement well beyond previous generations' norms. According to Robbins, Social Security was never meant to serve as the sole financial foundation for retirement. He says Americans must confront this reality and shake off any passive approach to retirement planning. For him, the wake-up call begins with facing the numbers - doing some straightforward calculations to understand exactly where one stands financially and how far there is to go. More on retirement: Dave Ramsey offers urgent thoughts about MedicareJean Chatzky shares major statement on Social SecurityTony Robbins has blunt words on IRAs,401(k)s Rather than wait for a crisis to force action, Robbins champions a proactive approach. He argues that the ability to plan ahead and anticipate one's financial needs is what separates those who thrive in retirement from those who struggle. "You can ... work toward the ultimate retirement dream: achieving complete financial freedom to do whatever you want with no fear of running out of money," Robbins wrote. In his eyes, financial confidence begins with clarity: Knowing the precise amount needed to retire comfortably is a non-negotiable first step in any serious plan. His core message? Stop avoiding the truth, engage with the math, and take charge before time runs out. Related: Tony Robbins sends strong message to Americans on 401(k)s To reduce reliance on Social Security, Robbins encourages people to approach retirement planning with clear-eyed realism and ambition. He believes that too many individuals make the mistake of planning around their income rather than their actual spending habits. For Robbins, knowing what you spend - especially if it's more than you earn - is the true foundation for estimating how much you'll need once work life ends. He stresses the importance of tracking annual expenses, not just to build awareness but to identify areas where spending can be reined in. Developing this habit now not only sharpens financial discipline but also frees up more resources for long-term savings. Once you've got a solid handle on your typical yearly spending, Robbins recommends multiplying that figure by 20 - a rough estimate for the number of years one might reasonably expect to live in retirement, given increasing life spans. He advises being cautious and realistic with assumptions, preferring conservative projections over overly optimistic ones. While this formula provides a baseline, Robbins knows many retirees dream of more than simply maintaining their current lifestyle. Whether it's globe-trotting, a luxury home upgrade, or new adventures, he urges people to run the numbers on their aspirational retirement too. Use the same framework, then apply it to the lifestyle you actually want - not just the one you have. Ultimately, Robbins challenges people to think beyond survival and aim for fulfillment. He believes retirement planning should inspire you to ask not only what you'll need - but what you truly desire. Related: Dave Ramsey warns Americans on Social Security The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Miami Herald
19-06-2025
- Business
- Miami Herald
Suze Orman sends surprising message on retirement, IRAs, 401(k)s
As Americans look ahead to retirement, one pressing issue often looms large: Will I have enough money to make it all work? Renowned personal finance expert and media figure Suze Orman offers clear, straightforward advice on navigating 401(k)s and Roth IRAs - tools she believes are key to a successful retirement strategy. Don't miss the move: Subscribe to TheStreet's free daily newsletter Orman strongly urges employees to take full advantage of their workplace 401(k) programs, particularly when an employer match is on the table. That match, she notes, is essentially "free money" that shouldn't go untapped. Her guidance: aim to contribute between 10% and 15% of your earnings to a 401(k), adjusting for your age and financial situation. If your plan includes a Roth 401(k), Orman says to seriously consider it, as it provides the potential for tax-free growth over time. She also highlights the power of Roth IRAs, which allow retirees to withdraw funds without facing taxes - making them a valuable piece of the retirement puzzle. Related: Jean Chatzky sends strong message to Americans on Social Security And there's one consistent theme in her messaging: start as early as you can. By doing so, you allow compound interest to work in your favor, helping you not only stay on track but possibly surpass your long-term savings goals. To Orman, retirement planning isn't merely about squirreling money away - it's about making intentional, wise investment choices that protect your wealth and help it grow. Orman calls attention to a recent report that explains a surprising outcome many people discover as they find ways to increase their retirement income beyond Social Security monthly paychecks and income from 401(k)s and IRAs. "I hope each of you does it on your terms, according to your plan," Orman wrote in a June 19 email newsletter. "But I hope your plan also considers the possibility that things don't always go according to plan." The 2025 Employee Benefit Research Institute's annual Retirement Confidence Survey highlights three ways in which well-intentioned retirement planning assumptions often don't pan out as expected. Working for pay in retirement. According to this year's findings, 75% of current workers anticipate continuing to earn income after they retire. Yet the actual numbers tell a different story - only 30% of retirees say they're currently bringing in a paycheck. Early retirement on your own terms. Roughly two out of every three individuals who said they retired sooner than they expected admitted the decision wasn't up to them. Around 30% were let go because of layoffs or company restructuring, while another 30% cited health issues or disabilities as the reason for leaving the workforce. A portion also retired early to provide care for a partner or family member in need. More on retirement: Dave Ramsey offers urgent thoughts about MedicareJean Chatzky shares major statement on Social SecurityTony Robbins has blunt words on IRAs,401(k)s Retirement as a gentle glide. Fifty percent of workers surveyed said they hope to ease into retirement by slowly cutting back on their hours instead of stepping away from full-time work all at once. But the experience of most retirees tells a different story - almost 75% said they had no such gradual shift. Instead, they stopped working suddenly, going from their last day on the job straight into full retirement practically overnight. Related: Tony Robbins sends strong message to Americans on 401(k)s, IRAs Orman encourages people to factor uncertainty into their retirement planning, especially as they calculate income they expect to receive from the 401(k) plans and IRAs they have been contributing to doing their working years. She advises people to clearly outline their expectations - when they hope to retire, how they envision that transition, and how much income they anticipate earning from paid work during retirement. Then, for each assumption, she suggests confronting the possibility that things may not unfold as imagined. She stresses that while future events such as layoffs or health issues can't be predicted or controlled, what people can do is take action now. By increasing savings today, they can create a financial cushion that offers more flexibility if life takes an unexpected turn. "It is fantastic to make plans and to work toward those plans," Orman wrote. "But the best plans are stress-tested to make sure they have a high probability of success, no matter what curveballs come your way." Related: Dave Ramsey sends strong message to Americans on Medicare The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
USA Today
08-06-2025
- Business
- USA Today
You don't want to rely only on Social Security for your retirement. Here's why.
You don't want to rely only on Social Security for your retirement. Here's why. There's a reason Social Security is such a big part of so many people's retirement planning. Those benefits could end up being a critical source of income for you later in life. In a recent survey by the Employee Benefit Research Institute, 87% of workers today expect to rely on Social Security for income in retirement. And among current retirees, 94% identify it as a key income source. But while it's perfectly OK to count on Social Security as a source of retirement income, you don't want to depend on those benefits too heavily. Doing so could upend your plans -- and cause you a world of financial stress. Are you too reliant on Social Security? If you work and pay into Social Security your entire career, there's a good chance you'll qualify for benefits once you retire. And while that's money you can count on to some degree (keeping in mind that Social Security cuts are still on the table), you don't want to rely on it too heavily. So, how do you know if you're going overboard? It's simple. If you expect Social Security to constitute the bulk of your retirement income, you're potentially making a mistake. If you think Social Security will provide all your retirement income, you're making an unquestionably huge mistake. More: Focusing only on your 401(k) or IRA? Why that may not be the best retirement move. In a best-case scenario -- meaning, if Social Security cuts don't come to be -- you can expect your monthly benefits to take the place of 40% of your wages. This assumes you earn an average paycheck and aren't a particularly high earner. Most seniors inevitably need about 70% to 80% of their former income to live comfortably once they stop working. And while there's certainly some wiggle room with this formula on either side, for the most part, living on 40% of what you used to earn won't make for a very enjoyable existence. Granted, if you're someone who earns $100,000 a year and routinely lives on $40,000 a year, you're the exception. (And hey, congratulations for mastering the art of living below your means.) But it's a common thing to spend the bulk of your paycheck while you're working. If that's something you tend to do, then you can't let yourself retire on Social Security alone. And you shouldn't necessarily let those benefits constitute the majority of your retirement income, either. See also: With the stock market reeling, what should nearly retired and early retirees do? Save for retirement now for more flexibility later Once you retire, you don't want to be pinching pennies. Rather, you want the flexibility to enjoy life and cover your bills without worrying about every single expense. If that's your goal, build savings to supplement your benefits so you can make sure you're not relying too heavily on Social Security. If you end up socking away enough money so that half of your retirement income is derived from Social Security and the remaining half comes from your individual retirement account (IRA) or 401(k) plan, you're probably in a good spot. Just as importantly, get an estimate of your Social Security benefits well ahead of retirement so you can see what monthly payments you may be looking at, assuming broad cuts don't happen. You can get that information by creating an account on The more you know what to expect from Social Security, the more efficiently you can map out your income needs and position yourself to meet them later on. The Motley Fool has a disclosure policy. The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY. The $23,760 Social Security bonus most retirees completely overlook Offer from the Motley Fool: If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets"could help ensure a boost in your retirement income. One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. JoinStock Advisorto learn more about these strategies. View the "Social Security secrets" »
Yahoo
08-06-2025
- Business
- Yahoo
Are You Relying Too Much on Social Security? Here's How to Tell.
It's OK to factor Social Security into your retirement income plans. It's important to have realistic expectations about what the program will pay you. Being overly reliant on Social Security could cause you a lot of financial stress later in life. The $23,760 Social Security bonus most retirees completely overlook › There's a reason Social Security is such a big part of so many people's retirement planning. Those benefits could end up being a critical source of income for you later in life. In a recent survey by the Employee Benefit Research Institute, 87% of workers today expect to rely on Social Security for income in retirement. And among current retirees, 94% identify it as a key income source. But while it's perfectly OK to count on Social Security as a source of retirement income, you don't want to depend on those benefits too heavily. Doing so could upend your plans -- and cause you a world of financial stress. If you work and pay into Social Security your entire career, there's a good chance you'll qualify for benefits once you retire. And while that's money you can count on to some degree (keeping in mind that Social Security cuts are still on the table), you don't want to rely on it too heavily. So, how do you know if you're going overboard? It's simple. If you expect Social Security to constitute the bulk of your retirement income, you're potentially making a mistake. If you think Social Security will provide all your retirement income, you're making an unquestionably huge mistake. In a best-case scenario -- meaning, if Social Security cuts don't come to be -- you can expect your monthly benefits to take the place of 40% of your wages. This assumes you earn an average paycheck and aren't a particularly high earner. Most seniors inevitably need about 70% to 80% of their former income to live comfortably once they stop working. And while there's certainly some wiggle room with this formula on either side, for the most part, living on 40% of what you used to earn won't make for a very enjoyable existence. Granted, if you're someone who earns $100,000 a year and routinely lives on $40,000 a year, you're the exception. (And hey, congratulations for mastering the art of living below your means.) But it's a common thing to spend the bulk of your paycheck while you're working. If that's something you tend to do, then you can't let yourself retire on Social Security alone. And you shouldn't necessarily let those benefits constitute the majority of your retirement income, either. Once you retire, you don't want to be pinching pennies. Rather, you want the flexibility to enjoy life and cover your bills without worrying about every single expense. If that's your goal, build savings to supplement your benefits so you can make sure you're not relying too heavily on Social Security. If you end up socking away enough money so that half of your retirement income is derived from Social Security and the remaining half comes from your individual retirement account (IRA) or 401(k) plan, you're probably in a good spot. Just as importantly, get an estimate of your Social Security benefits well ahead of retirement so you can see what monthly payments you may be looking at, assuming broad cuts don't happen. You can get that information by creating an account on The more you know what to expect from Social Security, the more efficiently you can map out your income needs and position yourself to meet them later on. If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known could help ensure a boost in your retirement income. One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these Motley Fool has a disclosure policy. Are You Relying Too Much on Social Security? Here's How to Tell. was originally published by The Motley Fool
