As 2025 comes to a close, it’s clear the year has been full of highs and lows. In April, the S&P 500 experienced its largest four-day drop since the 1950s after President Trump introduced global tariffs. By October, it had bounced back to new all-time highs. At the same time, U.S. debt keeps rising and Social Security’s long-term funding challenges remain in focus. Reminding us that navigating the opportunities and risks requires both insight and grit.
In this blog, I’ll address some common questions that arise along your financial journey:
- “How much should I save?”
- “How should I save for retirement?”
- “Do I have enough to retire?”
- “How long will my money last?”
After decades of working, and saving, one day you flip your mindset towards retirement. Retiring hasn’t gotten any easier and each generation faces new, more complex challenges. In the sections that follow, I’ll share some perspectives to help you navigate each question with confidence.
“How much should I save?”
Whether through your employer or on your own, there are many ways to save and invest for retirement. As someone in the financial industry, I view saving and investing as a form of discipline. And like any discipline, the more consistently you practice it, the more natural it becomes, and eventually the better you get at it. For most people, starting with an employer-sponsored retirement account is the easiest approach. Making consistent contributions directly from your paycheck helps ensure that you stay disciplined. Retirement accounts come with annual contribution limits, so it’s important to also diversify how you save. Even if you’re unable to maximize your employer-sponsored contributions, there is an inherent benefit to the habit of saving. There are also advantages to holding retirement funds in both pre-tax and post-tax accounts. This balance can provide valuable flexibility later in life. One of the greatest advantages you have early on is time. When you’re young, time is on your side, and even small contributions can make a meaningful difference as compound growth works in your favor. But it’s also important to consider how you save, not just when you start.
“How should I save for retirement?”
Saving money is a great first step, but what then follows is how you save it. The real goal is to outpace inflation, and historically the most reliable way to do that has been through the stock market. You want to ensure your money is working for you as effectively as possible. When saving for retirement or any goal, your time horizon is one of the most important factors to consider. For some of you, this money may not be needed for more than 20 years, while others may begin using it in the near term. With that in mind, it’s important to make sure your portfolio is invested appropriately, focusing on growth-oriented assets when you have a long-time horizon, and shifting toward more protective investments as you approach retirement to help reduce the risk of significant losses. For many investors, the S&P 500 is a great starting point, investing in the largest and most established U.S. companies has historically provided dependable long-term growth. A key point in this step that often goes overlooked is the importance of staying invested. There will be periods of strong performance and times that feel challenging, but staying the course is essential. Especially when you’re still building wealth you won’t need for many years. Most mistakes happen during market downturns, when emotions run high. Investors often sell at the worst time and then struggle to get back into the market. Once you understand the importance of staying invested and maintaining a long-term strategy, the focus naturally shifts to the bigger picture: assessing whether you’re truly on track for the retirement you envision.
“Do I have enough to retire?”
Everyone has their own vision for what they want retirement to look like, and there’s no one-size-fits-all approach to determining how much you need to save. The amount required varies widely, as certain retirement lifestyles will demand a larger amount of savings than others. There are also additional factors to consider beyond your personal nest egg. Whether or not you have an employer pension, most of you will receive a form of pension through Social Security benefits. This means that, in addition to your own retirement savings, you’ll have a steady stream of income to help support your expenses. So, when evaluating whether you have enough saved, be sure to factor this additional income into your decision-making. This is also the time to assess the overall risk in your retirement investments. As your timeline to retirement shortens, your exposure to more volatile assets, like stocks, should typically decrease. Protecting your retirement savings from an unexpected market downturn becomes increasingly important, as it can significantly impact what your retirement ultimately looks like. After determining whether you’re financially ready to retire, the next step is figuring out how long your money can realistically support your lifestyle.
“How long will my money last?”
Once you retire, you enter a phase that looks very different from the one you’ve been accustomed to for so many years. Your savings and investments shift from accumulation to providing income and, most importantly, supporting the goals you’ve planned for. When investing in retirement, we need to be aware of sequence-of-returns risk. A term used in the industry to describe how market losses, combined with ongoing withdrawals, can impact how long a portfolio will last. This wasn’t a concern during your working years because as long as your average return was positive, and you saw your savings grow, you were happy. However, a key point that is often overlooked is that retirement spending doesn’t follow a straight, linear path of simply increasing a little each year. In practice, spending tends to peak during the early years of retirement and then stabilize as you age. Even so, with people living longer and medical costs continuing to rise, it’s important to ensure your portfolio is positioned to last 30 years or more. This is the time to be more strategic, building a diversified portfolio that can withstand varying market conditions. Rather than being fully exposed to volatile growth assets, it’s important to take a balanced approach by segmenting your portfolio into different “buckets.” Cash and cash equivalents, bonds, and stocks. These three segments work together to support both your near-term and long-term spending needs.
Sources: https://finance.yahoo.com/news/62-americans-no-idea-long-145841050.html