‘Sometimes, everything can go down’: Suze Orman says you need this much cash to retire, and it’s more than you’d expect

Core Insights - The article emphasizes the importance of having a retirement savings target that exceeds the average expectation of $1.26 million, particularly for individuals with annual expenses of $50,000, suggesting an additional $150,000 to $250,000 for flexibility in retirement timing [1][5]. Retirement Planning - Suze Orman advises against relying solely on 401(k) or IRA accounts due to their market dependency, recommending that individuals maintain three to five years' worth of living expenses in a liquid, low-risk account [2][7][8]. - The average American's perceived retirement savings need is $1.26 million, but many are not on track to meet this goal, highlighting the risks of market fluctuations when planning for retirement [5][23]. Emergency Fund and Cash Management - Building an emergency fund of three to six months' worth of expenses is recommended, with Orman suggesting a minimum of three to five years for added security [11][12]. - High-yield savings accounts are highlighted as effective tools for growing emergency funds, offering better interest rates than traditional accounts [12][14]. Investment Strategies - Diversification is crucial to mitigate risks associated with market volatility, with alternative assets like precious metals and real estate suggested as potential options [19][20]. - The article discusses the importance of starting retirement savings early, with specific monthly investment targets outlined for different age groups to reach the $1.26 million goal [23][24]. Financial Tools and Services - Automatic investment services, such as Acorns, are presented as convenient methods for consistent saving and investing, allowing users to round up purchases and set up recurring deposits [25][26].