Core Insights - The article emphasizes the importance of evaluating financial readiness before retirement, particularly for those planning to retire in 2026, and suggests that relying solely on Social Security may not be sufficient for a comfortable retirement [1]. Financial Overview - The average monthly Social Security benefit for retired workers was $2,013.32 as of November 2025, which translates to approximately $24,000 annually. This amount is expected to increase slightly due to a 2.8% cost-of-living adjustment (COLA) in 2026 [3][5]. - Medicare Part B premiums are projected to rise to $202.90 per month in 2026, which will be deducted from Social Security benefits, potentially reducing the net income available to retirees [4]. Retirement Planning Strategies - The article suggests that individuals relying solely on Social Security should consider delaying retirement to build additional savings, such as contributing to an IRA or 401(k), which can provide financial flexibility [6]. - Even a modest contribution, such as $12,000 into an IRA over two additional working years, can help cover unexpected expenses during retirement, thereby enhancing financial security [7][9]. - The article highlights the potential struggles retirees may face if they depend exclusively on Social Security, advocating for supplementary income sources, including part-time or gig work, to improve overall financial stability [8].

jacoblund/Getty Images Your crucial retirement number isn’t the balance of your 401(k). Key Takeaways Most households should aim to replace 70% to 85% of their pre-retirement pay, combining savings withdrawals with Social Security. Adjusting the mix of contributions, your claiming age, and products such as annuities lets you hit a personalized replacement target. Reaching $1 million in your 401(k) is a big milestone, but a seven‑figure balance can be a mirage. The question is whether all of your ret ...

Core Insights - A significant concern for preretirees is the fear of outliving their savings, with 53% expressing this worry according to the Schroders 2025 US Retirement Survey [1] Financial Requirements - Experts suggest that individuals need approximately 80% of their pre-tax earnings to maintain their standard of living post-retirement, which for Darren translates to $4,667 monthly [2] - Darren believes he can retire comfortably with a combination of Social Security benefits and additional income, estimating he will receive nearly $1,700 monthly from Social Security and an extra $2,000 [2] Savings and Withdrawal Strategy - Using the 4% rule, Darren's $500,000 savings would yield about $1,667 monthly, which is insufficient for his needs, prompting the search for alternative income sources [3] Retirement Delay Options - Delaying retirement is a viable option, as nearly 25% of Americans choose to do so, which can help reduce the amount needed from savings and increase overall savings [4] - Contributing maximally to retirement plans, especially if employer matching is available, can significantly enhance retirement savings. In 2025, Darren can contribute up to $31,000 to his 401(k), or $77,500 including employer contributions [5] Social Security Benefits - Delaying retirement can also lead to increased Social Security benefits. If Darren postpones retirement until age 66, his monthly benefit would rise to approximately $1,850, and if he waits until 67, it would exceed $2,000 [6]

Group 1 - The ability to convert to a Roth IRA is not limited by age, and there is no earned income requirement for conversion [1][2] - The primary consideration for a Roth conversion should be whether it aligns with the goals for the legacy of wealth, especially as individuals approach required minimum distributions (RMDs) [2][3] - Financial advisors can assist in managing the tax implications of a Roth conversion strategy [3] Group 2 - If the intention is to leave wealth to a charity, converting to a Roth may not be beneficial, as taxes would not be due on the IRA balance when passed to a qualified charity [5] - Conversely, if the goal is to leave wealth to family members, converting the IRA to a Roth could ensure that beneficiaries receive tax-free assets, although it may not maximize tax savings [7][8]