Key Takeaways For people in their 60s, retirement accounts typically hold more than $300,000 in stocks on average—but the median balance is closer to about $100,000. Taxable brokerage accounts vary widely, but industry data show engaged near-retirees often hold low- to mid-six-figure balances. As retirement nears, many wonder if their investment portfolios will provide the income they'll need. For most Americans, the bulk of these investments is in qualified retirement accounts, such as 401(k) plans ...

Core Insights - Retirement planning requires making financial sacrifices today for a comfortable future, emphasizing the importance of long-term decision-making [1] Group 1: Retirement Account Contributions - Maximizing contributions to tax-advantaged retirement accounts is crucial for enhancing savings, with potential regrets for not doing so in the future [3] - The IRS will increase the maximum annual contribution for 401(k) accounts to $24,500 in 2026 from $23,500 in 2025, and for IRAs to $7,500 from $7,000, with catch-up contributions for those over 50 rising to $1,100 from $1,000 [4] Group 2: Employer Matching Contributions - Ensuring participation in a 401(k) plan to receive full employer matching contributions is essential, as it represents free money that can significantly impact future savings [5] - The opportunity cost of not participating in an employer matching program is substantial, equating to turning down potential growth of contributions [6][7] Group 3: Automating Savings - Automating retirement savings contributions is recommended, treating it as a regular budget item that will yield benefits in the long run [8]

Core Insights - Retirement savings are crucial for financial security, yet many individuals are not adequately prepared [1] - Annuities are highlighted as a beneficial strategy to enhance retirement savings, particularly for the year 2026 and beyond [2] Annuities Overview - An annuity is an insurance product that provides a series of payments, offering a steady income stream for retirees and mitigating longevity risk [3] - Annuities consist of two main phases: the accumulation phase, where contributions are made and funds grow, and the annuitization phase, where payments are received [4] Types of Annuities - Fixed annuities guarantee a specific rate of return over a set period, aiding in budget planning, though inflation may diminish purchasing power [5] - Variable annuities allow for growth based on investments in mutual funds, stocks, or bonds, with payouts dependent on investment performance [5] - Deferred annuities provide payouts at a future date, establishing an income stream for later retirement [5] - Immediate annuities start payments within one year of a lump sum deposit, offering quick access to income [5]

The old retirement playbook is cracking under pressure, and self-made millionaire Sam Dogen wants Americans to wake up before it’s too late. Under the classic model, American workers were said to be able to rely on three major sources of income in retirement: Pensions, Social Security and personal savings. But for Dogen, who retired at age 34 and now runs the popular personal finance site Financial Samurai, that model no longer works. Dogen, now 47, was able to walk away from his full-time job thanks to ...

SDI Productions / Getty Images Indeed, while more than 80% of Americans in their 60s are invested in retirement plans, only about 35% have brokerage accounts. Key Takeaways For people in their 60s, retirement accounts typically hold more than $300,000 in stocks on average—but the median balance is closer to about $100,000. Taxable brokerage accounts vary widely, but industry data show engaged near-retirees often hold low- to mid-six-figure balances. As retirement nears, many wonder if their investme ...

Core Insights - The article emphasizes the importance of year-end financial housekeeping to enhance savings, reduce tax liabilities, and prepare for financial success in 2026 [1] Group 1: Retirement Contributions - Contributions to employer-based retirement funds, such as 401(k) plans, must be made by December 31, 2025, to count for the current tax year, unlike IRAs which can be funded until April 15, 2026 [2] Group 2: Tax Withholdings - Adjusting tax withholdings through Form W-4 is crucial to avoid overpaying taxes and receiving large refunds, which effectively act as interest-free loans to the government [3][4] Group 3: Capital Loss Harvesting - Investors can utilize loss-harvesting strategies to sell losing investments and offset gains, which can also allow for up to $3,000 of excess capital losses to offset non-investment income [5][6] Group 4: Charitable Donations - Charitable contributions must be made by December 31, 2025, to qualify for tax deductions on the 2025 return, with various forms of donations accepted [7]

If you have $2 million in retirement savings, congratulations. That’s well above the $1.26 million that Americans, according to Northwestern Mutual, believe is needed to retire comfortably. (1) At this point, you have probably overcome the challenge of saving enough. Now, your next mission is wealth preservation. Higher taxes and the wrong lifestyle choices can quickly erode what seems like a huge treasure trove. Shifting your perspective from building wealth to protecting it isn’t easy. But the journey ...

Core Insights - A new savings option called Trump accounts, created under the Working Families Tax Cuts bill, is gaining attention from parents for children's future savings, featuring a $1,000 government seed contribution before any family contributions [1][17] - Contributions to Trump accounts will not start until July 4, 2026, but interest is rising, especially after tech billionaires Michael and Susan Dell pledged $6 billion to fund 25 million accounts [2][17] - Experts note that the concept of Trump accounts is not new, having been proposed under various names over the years [3][17] Trump Accounts Features - Trump accounts are not limited to education expenses; funds can be used for any purpose once the child turns 18, although the money is locked until then with no early access [4][5][7] - Unlike traditional IRAs, Trump accounts do not require earned income for contributions, allowing parents, grandparents, and employers to contribute on behalf of a child [8][17] - Upon turning 18, the account transitions to a traditional IRA, with withdrawals subject to income tax and a 10% penalty for early withdrawals before age 59½ [9][17] Comparison with Other Savings Options - Trump accounts differ from 529 plans, which are specifically designed for education costs and allow tax-free growth when used for qualified expenses; Trump accounts do not offer tax-free growth [10][11] - Coverdell Education Savings Accounts (ESAs) and custodial accounts under UGMA or UTMA rules are alternatives, with ESAs allowing tax-free growth for education and custodial accounts having no contribution limits but affecting financial aid eligibility [12][13][17]

Core Insights - Health Savings Accounts (HSAs) combine benefits of traditional and Roth retirement accounts, offering tax advantages and flexibility for retirement savings [2][4] Group 1: HSA Features - HSAs allow contributions with pre-tax dollars, tax-free investment gains, and tax-free withdrawals for qualifying healthcare expenses [5] - Funds in HSAs do not expire, providing a long-term savings option [5] - HSAs can function as a retirement savings account, allowing for potential tax-free income in retirement if funds are kept invested [6] Group 2: HSA Withdrawals - Withdrawals for non-medical expenses incur a steep penalty of 20%, which is double the early withdrawal penalty for traditional IRAs or 401(k)s [7] - Retirees are encouraged to evaluate their eligibility for HSAs, especially with new insurance options available in 2026 [4]

Core Insights - The article discusses the limitations and challenges of traditional retirement accounts, emphasizing the need for alternative strategies to achieve financial independence and flexibility [1][6][13] Group 1: Traditional Retirement Accounts - Retirement accounts like 401(k)s and IRAs are described as "money jail," providing tax benefits but restricting access to funds until age 59 ½, which can hinder financial flexibility [2][5] - Required Minimum Distributions (RMDs) must be taken starting in one's 70s, with penalties for non-compliance, further complicating financial planning [1] Group 2: Alternative Strategies - The founder of Waystone Advisors advocates for using a securities-backed line of credit (SBLOC) as a more flexible financial tool, allowing investors to access cash without selling investments and incurring capital gains taxes [7][10] - SBLOCs enable investors to utilize their assets for multiple purposes simultaneously, enhancing wealth-building opportunities [8] - The strategy is not limited to high-net-worth individuals; even those with modest savings can benefit from SBLOCs to invest in real estate or other ventures [10] Group 3: Financial Independence - The article highlights that the wealthiest individuals often achieve financial success through entrepreneurship and investments rather than solely relying on retirement accounts [3][4] - Dean suggests that individuals seeking early retirement should consider lowering their contributions to retirement accounts to maximize flexibility and access to funds [10][12] - A self-directed IRA is presented as another option for older clients to diversify their investments without liquidating retirement accounts [11][12]