What Is the Biggest Retirement Planning Mistake?

Suze OrmanThat’s easy to answer: Not having a plan!

Building a financially secure retirement doesn’t happen by itself. You need to make a commitment to smart financial decisions long before retirement — starting in your 20s would have been ideal — and then keep carrying through on your retirement plan.

Here are some other big retirement-planning mistakes I want you to avoid:

  1. Not maximizing your Social Security retirement benefit. I strongly encourage you to wait until your Full Retirement Age (FRA) to start receiving your Social Security benefit. That’s between age 66 and age 67 depending on the year you were born. The payout will be 25 to 30 percent higher than what you are eligible for if you start at age 62, which is the earliest you can claim.  And ideally, if you are in good health and there is longevity in your family, I encourage you to devise a financial plan that allows you (or your spouse — whomever is the highest earner) to delay starting until age 70. Every year past your FRA through age 70 entitles you to a payout that will grow by a guaranteed eight percent. You can’t get eight percent guaranteed investing these days!
  2. Not saving on your own. Yes, Social Security will be an important source of income in retirement. But chances are it won’t cover all of your basic needs, to say nothing of a few wants. You don’t have a workplace retirement plan? Then, I want you to save up in a Roth IRA. If you are over 50 this year you can contribute $6,500. That’s $125 a week. Please take a hard look at all your spending and see if you can free up more money to build a strong retirement fund.
  3. Not accounting for medical costs in retirement. It’s so important to understand that Medicare doesn’t cover everything, and not many people have retirement health benefits from an old employer. On average, retirees end up needing to cover about 30 percent of their health care costs.
  4. Not Planning for a Very Long Life. There is a 50 percent chance a 65-year-old woman today will still be alive at age 88. And for a 65-year-old male there is a 50 percent chance he will still be alive at age 85. (Check out this free online life expectancy calculator.) Given the possibility of living a long time, you need to make sure your savings will last longer than you! One smart way to stretch your savings is to keep working in your 60s, even if it is part-time work. Delaying your Social Security start date, and reducing your withdrawal needs from IRAs and other accounts in your 60s will provide you more income for what I hope is a wonderful and long retirement.


SSA does not endorse any particular financial advisory product or service.


95 thoughts on “What Is the Biggest Retirement Planning Mistake?

  1. I would say the biggest mistake in planning for retirement is allowing our so called government to take 14% of our money and give back maybe 3% after several decades of inflation. And they do this by force with threats and weapons. Not a very neighborly thing to do. It is certainly not helping.

    • Don’t worry, you won’t have much longer to worry about your government doing terrible things – like ensuring your ability to survive in you golden years – much longer. The GOP is passing literally dozens of bills every day that terminate every single service, resource, benefit, or protection the government has ever provided for the good of all of us average Americans, redirecting every dollar to the their corporate owners and the ultra-wealthy. Thanks to these willfully ignorant complainers who never bothered to learn anything about their government, like how it works, or the vital and useful services it provides us all, the equally ignorant buffoon they voted in to “drain the swamp” is rapidly turning America into quicksand, gleefully signing everything they put before him, and we’re all going down fast. Keep complaining; maybe you won’t notice as you’re circling the drain. You’ll be there about two seconds before me; I’ll be sure to wave as you go by.

        • if you cant see the truth your as mentally ill as trump is. I voted for trump and now i’m saying my god what have i done.And i’m a republican .Dark days are coming

        • No, it’s factual information easily found on congress.gov, where you can read the full text of the actual bills Congress is proposing, passing, and repealing every day. That website is one of those services I was referring to. You can also find the same information on the Federal Register site, which also contains all the history of every bill passed since Congress began, at every stage of those bills’ development. You can even sign up to receive this information daily via email so you don’t even have to look it up yourself – along with everything else our government does every day. You can choose what you’d like to track and receive email notifications and links to all of it.

          The only part of my comment that was opinion was the “buffoon” remark, and that’s an opinion shared by millions of Americans, “liberal” and conservative alike, who love this country and who have the common sense to know the difference between facts and uniformed “BS.” Speaking which, where can these nice readers find the facts behind the “statistics” you cited? Or was that YOUR right-wing opinion?

          • these lies are the drivel that got us here. figure out how wealthy you COULD be if g bush had been able to privatize it. the dems blocked it because wealthy people would start asking questions so they could hold on to their money. the dems HAVE to keep people poor so they can control them.

          • PAUL RYAN??? Ann Rand worshiper; a man raised on Social Security survivor benefits, and government grants pay for his college, who is now the architect of the very plan designed to eradicate those very programs for the rest of us?

            I see now. You put forth one plutocrat’s selfish beliefs against over 200 years of Congressional work to build a country where everyone can live and thrive. I see now that I’m wasting my time providing facts. If you truly believe that one man’s personal political beliefs should replace over 200 years of documented Constitutional legislation, the actual original documentation of the birth and development the United States, then it’s you that needs to pull your head out.

            There’s no profit in arguing with irrationality. Take away this: you and those who choose to believe as you do have the demise of millions of your fellow Americans – and the demise of ths great country – on your heads. So be it.

      • I guess I do not see how stealing from neighbors and giving to other neighbors is a good thing? It has racked up Trillions in Debt. How can you demand that your government does things to your neighbor’s that would put you in jail? How does any of this make sense? What happened to “Liberty and Justice for All”?

    • Many of us cannot save or the savings went for debts, unforeseen events, medical bills etc, most Americans will never be wealthy, because most of the wealth is in the hands of a few, we continue to live “The American Nightmare”, Suzy is a lot of hot air.

  2. I am 68 yo and have $40000 in debt. On a fixed income Soc. Sec. and Pension. Around $3800 a month.I have a mortgage and the credit cards are getting paid but I am a hostage to them. Thank goodness for overdraft protection. Is a refinance the best way to go? Help, I am diabetic and cannot go back to work. Children are no help

    • Your children are not there to help you if you mismanaged your life. Hopefully they have their own family to take care of, that is their responsibility. NOT to take care of you, and support you through your golden years!!!

  3. Yes, had planned on three sources: one, pension from company from which retired; two, social security (as long as Congress doesn’t interfere) and three, Roth IRA which got depleted due to market crash. Have replaced #3 with CD that eventually will be converted to annuity to increase monthly income if spouse expires before me. Of course, there will be life insurance that will help with final expenses.

    • Companies abandoned pensions in favor of 401 (k)s over 30 years ago, so much for option #1. Social Security is being eliminated by Congress even as everyone sits here posting complaints and criticisms about it, so don’t count on option #2 to be there. As far as your Roth IRA being “depleted by the market crash,” well, that’s exactly what will happen if Social Security is privatized; the stock market is NOT SAFE. Why is it so difficult for people to see the connection?

      Option #3, the CD that converts into an annuity – yeah, good luck with that. Some are perfectly acceptable, most are scams. Hopefully you worked with a genuine financial advisor and not a broker who directed ypu into an annuity that generates the highest commission for himself and the biggest profit for his company while leaving you high and dry. Hopefully you read the fine print and had the whole thing reviewed by a competent attorney before forking over/tying up your life savings.

      As for the life insurance, well, hopefully they won’t find some trumped-up reason to deny the claim or, at best, delay payout. I honestly wish you the best.

        • Not complaints, stating facts easily discoverable. And you must have missed the “practical suggestions,” I gave, like checking into the credentials of investment brokers either selling annuities or handling your IRA, having an attorney review everything to explain all the details and make sure it’s legally sound so you won’t be swindled, and hopefully, keeping a close watch on the FACTS about what Congress is doing with Social Security, which can be found on congress.gov. Are THOSE “helpful suggestions” clear enough for you now?

  4. I totally disagree with the advice to wait until age 70. I thought that, too, for a long time — until I did the math. I would have to live to age 78 before I “caught up” with waiting until age 70 to take my benefits. Each individual needs to do that calculation, taking into account specifically his/her health and financial situation. Social Security will help people calculate this number for those who cannot do this themselves. However, a blanket statement that people should wait until 70 is totally misleading.

    • You are spot on. If you have to draw down your other resources so that you can wait to draw SS it might be a lot better to take your retirement at age 62. Doing otherwise might leave you with just SS to live on.

    • I also agree and your math is correct. For every additional year you work your leaving social security benefits “on the table”. Add up that 8 years of money and you’d be surprised. I’d rather collect early then take it at 70 only to drop dead 4 years later.

      • I am a mathematician. I have done the math. Yes the break even is around 80. As others have said, look at your health and the longevity in your family. In my case I cou,d live from 90-95. If I lived to 90 or 95, waiting to 70 easily beat out of pocket even taking into account what you have to spend of your own money. The other variable is do you have enough savings and/or pension to last to 70. Personally my gut says take it at least when I hit 66, but the numbers keep telling me to wait.

    • I am paying social security fr 2003 federal state city and what I am getting in return zero I see hard time every month what the social security did

    • I agree with you totally. Not everyone lives until that magic age of 88/85. Who has all that money to carry you until you are 70? maybe some do, but I’m pretty sure not many! I would have to drain everything I have to maintain my standard of living for 8 years without collecting. Besides, I would like to do things now that I may not be able to do after 70 or 80!!

    • Whether or not to wait until 70 to start taking your SS is a very individual decision. It is always a gamble because you first have to know when you are going to die to maximize the total amount of SS money you receive. I am 68 and still working so I don’t need the additional income right now. It makes sense for me to wait. I picked 85 to be my death year for planning purposes and my break-even age for SS is around 80-81. If you need the money now, take it….if you are reasonably healthy and don’t need the additional now, wait.

  5. I did some planning and calculations also. I did not start my Social Security until age 70, and I am getting 50% more than I would have at full retirement age. Everyone needs to figure out their own situation. Society would be a lot better off if they did more planning and figuring and lot less complaining. Do your homework, it’s hard but satisfying. Good luck!!!

    • Well said. It’s not surprising we’re finding ourselves in this frightening situation today when you see people continuing to criticize and stubbornly deny the truth, even when the facts are placed before them.

  6. Hopefully we have all saved a little nest egg and have recovered somewhat from the financial crisis. Social Security was never intended to cover your every need, only to keep people out of poverty in their old age. At this point, all we can do is wait and see what the government is going to do. Pray that they will not wipe us all out.

    • True ss was not meant to cover everything, but pensions used to help. When 401ks were introduced, and employers started to cut pensions, only those very disciplined with a very good income had a chance to save enough for a decent retirement. Just my opinion. Eveyone says, have kids, put them through college, etc., and then somehow at the end of the month, save a little for retirement.

  7. For those who find they can’t work full time, past age 62 as a result of a disability, illness or injury, but who would like to follow this advice to maximize benefits by waiting to retire at FRA, consider if you are eligible for disability retirement in the meantime! You might find you are eligible for disability retirement from age 62 and then be able to convert to age related retirement at your FRA.

    • Would you try to “go it alone” regarding disability, or would you hire a lawyer? I assume you are an attorney.

  8. I am 70.5 yrs, still working and started receiving my SS at age 67. I am healthy, energetic and am considering retirement at 75 yrs. Can I request to halt my SS until I decide to stop working?

    • Hi Ruth. You earn Delayed Retirement Credits when and if you delay getting your benefit up until age 70. The benefit increase no longer applies when you reach age 70, even if you continue to delay taking benefits. If you need further assistance, call our toll free number, 1-800-772-1213 (TTY 1-800-325-0778) and ask to speak with one of our representatives, who are available Monday through Friday between 7 a.m. and 7 p.m. Thanks!

  9. Thank you for some other excellent article.
    The place else may just anyone get that type of information in such a perfect approach of
    writing? I’ve a presentation subsequent week, and I’m on the look for such info.

  10. With my salary there isn’t any money left for saving …
    I earn under 17,000 a year… and no COLA… so I hope
    I have money for my last day on earth!
    And what does the government do – give raises to the rich and the heck with everyone else..

    jimin: hits him
    jin: AGAIN
    jimin: obeys
    jin: I LOV IT. AGAIN.
    nj: what is going on in there What Is the Biggest Retirement Planning Mistake? başlıklı Konunuzu okudum ve beğendim, https://blog.socialsecurity.gov ailesi sizlere başarılı bir yayın hayatı diliyorum. Teşekkürler.

  12. Wow I did not expect so many long rants on by Post. Just think about it, Democrat or Republican. The government get’s it’s authority from our neighbors. How can we ask the government to do things to our neighbors that would be a crime if I did them? How can you authorize your government to commit crimes against your neighbor? most of what our so called government does today you and I would be thrown in jail for if we did the same thing to our neighbor. This mess we pretend is Liberty and Justice for all is really a monstrous criminal enterprise with a monopoly.

  13. Tired 0f the negativity and ranting! Let’s see/hear some real positive solutions. Wish now I had interest back in HS in politics; I wouldn’t feel so nieve. I could actually be a part of finding the positive solutions. God bless the USA!

  14. Can you recover your SSA account password if you had to change your email because it was hacked if so how? Thanks.

    • Hi Joseph. If you had to update your email address on your my Social Security account, you will need to update your account information by visiting your local Social Security office. You will need to provide proper identification. We prefer a government issued document with your picture, as proof of identity (driver’s license, passport, etc. In addition, if you suspect fraud, waste or abuse of Social Security benefits, we encourage you to report it. We will investigate all allegations of misuse, gather facts and evidence, and make a decision on whether misuse has occurred. We hope this helps.

  15. ” Because of the invention of clip on earrings, traditional pierced earrings started to fade out of the picture. There are various sites on the Internet that showcase a huge number of designs with relevant pictures to bring you exactly what you are looking for. Glass beads can be mass produced in any colour, size of shape so that they can be used cheaply to create this lovely unique jewellery designs. So to make the customers satisfaction, the artists introduces fashion jewelry by replacing the precious metal Gold. From top to bottom like necklace, ring, eyebrow ring, chains are now designed exclusively for men by fashion industry. We expect our cash flow to be more lucrative during Fall (for holiday shoppers) and Spring, with a slow-down in Summer months, as online traffic and shopping in general seems to slow down in those periods. is far more interesting than sterling silver studs and plain chains. Article Source: Watson has been involved in the fine jewellery property market for many years. Despite the doom and gloom of the recession, credit crunch and harsh economic climate our desire for beautiful things has endured. It is a fact the chunky Celtic designs do look good, but they can drill a hole in your pocket too. ”


  16. Is it not true that SS has never needed fed gov money. Actually, the Fed Gov borrowed from SS and isn’t that partly or the whole reason why they now are trying to hurt it. fed Gov can’t afford to put back into the SS system what it took out.

  17. I am 70.5 yrs, still working and started receiving my SS at age 67. I am healthy, energetic and am considering retirement at 75 yrs. Can I request to halt my SS until I decide to stop working?

    • That’s great John! Remember that the benefit increase no longer applies when you reach age 70, even if you continue to delay taking benefits. In the other hand, if you work and are full retirement age or older, the amount you make at work will not affect your Social Security benefits, no matter how much you earn. Please read our publication “How Work Affects Your Benefits” for more information.

  18. Dear Suzy:
    I have been a teacher for 15 years and do not pay into Social Security. Through most of these years (13) I also worked a job that paid into Social Security. I have 30 substantial earning years now, so I know the Windfall Act will not affect my Social Security benefits. However at age 66, I do not want to collect my Social Security, I want to wait until I’m 70. However, I do meet the requirements based on my birth date to still be able to collect 1/2 of my husbands Social Security at age 66. I have gotten 2 different answers from the Social Security office. One person says that the GPO will still apply and another says it won’t because I have 30 years in Social Security. I actually went to Social Security to find out and they said iThe GPO doesn’t apply only because I have the 30 years and perhaps the other person didn’t look up my records. Can you help? I want the correct answer. Thanks

    Kathleen McConnon

  19. Dear Suzy:
    I have been a teacher for 15 years and do not pay into Social Security. Through most of these years (13) I also worked a job that paid into Social Security. I have 30 years now so I know the Windfall Act will not affect my Social Security benefits. However at age 66, I do not want to collect my Social Security, I want to wait until I’m 70. However, I do meet the requirements based on my birth date to still be able to collect 1/2 of my husbands. I have gotten 2 different answers from the Social Security office. One person says that the GPO will still apply and another says it won’t because I have 30 years in Social Security. I actually went to Social Security to find out and they said the GPO doesn’t apply only because I have the 30 years and perhaps the other person didn’t look up my recordt. Can you help? I want the correct answer. Thanks

    Kathleen McConnon

  20. I’m 63, I want to quit my job and not work anymore. And wait about 30 months to start my SS benefits at 66
    If I take SS now I get approx. $1536 a month. At 66 and 0 months it is $1872 a month.
    My question is: To get the Full Retirement amount, do I still have to work until I’m 66? Or can I not work and I will still get the full retirement amount?
    Please advise, Thank You, Walter

    • Thank you for your question, Walter. For retirement benefits, we use the individual’s highest 35 years of earnings to compute monthly benefit amount. You can start receiving retirement benefits as early as age 62, but if you decide to get benefits before your full retirement age, they will be reduced. The longer you delay your retirement benefits, the higher benefit amount you will receive.
      The best way to start planning for your future is by creating a my Social Security account online. With my Social Security, you can verify your earnings, get your Social Security Statement, and much more. Also, we have a variety of benefit-calculators to help you plan for the future. Hope this helps!


  22. I am currently on disability since 2015. I receive benefits due to spouse deceased. I am 64 year old female.
    does my becoming age 65 next year effect my benefits? does it effect my Medicare? do i get to “RETIRE”? will my social security benefits increase in any way at age 65? should I retire, when? thank you.

  23. Is accrued vacation pay (paid to you) after retirement,
    included in your annual earnings limit if you draw social security before your full retirement age? Example:
    Employee retires in 2018 in August, is only age 64. In September receives check for unused vacation pay. Does this count towards limited earnings and cause him to owe back Social Security collected for September?
    Limit is $17040 for 2018 so the monthly amount for rest of 2018 would be $1420 and still qualify to collect the SS. Taxpayer did not work but was paid vacation pay over that limit of $1420

    • Hello Barbara. If you start receiving benefits between age 62 and your full retirement age, the amount will be permanently reduced by a percentage based on the number of months up to your full retirement age.

  24. Is there any help/relief for those who had to apply for Social Security at age 62 due to the 2008 Recession, which I believe began in 2005? I applied for Social Security early and I received less than 40% of what I was entitled to receive had I waited, but I had just purchased a new home, and lost my job within 2 years, which was one year prior to me receiving vested interest in my company’s retirement plan. I could not find a job that paid anything close to what I was making to sustain my home; consequently, my home was foreclosed upon, and I ended up homeless for 2 years until I was old enough to apply for Social Security early. I am barely existing on my Social Security, and the cost of living is continually rising. The yearly increases from Social Security is 1-3%, but Medicare, Parts B and C take that and more, so there’s been no increase – only a decrease in the amount of Social Security I receive.

    • Hello Marquita, please visit the Medicare website to learn about programs available to assist people with low income to pay for Medicare expenses. Many states also have programs to help with Medicare payments. You can find out about them by calling your State Medical Assistance Office. To get the local phone number, call the Centers for Medicare & Medicaid Services at 1-800-633-4227 (TTY, 1-877-486-2048). Thanks!

  25. I’m on disability drawing $1343.00 per mo. Is this the same monthly amount I would receive if I retire at age 63. I don’t expect to live past 73 years.

    • Hello William. Remember that your disability payments are established at the highest rate possible, and that while you may be eligible to switch from disability to retirement benefits at age 63 your benefits will be reduced. This is because we apply reduction factors to retirement benefits if you start receiving them prior to your full retirement age.
      When you reach full retirement age, we will automatically convert your disability benefits to retirement benefits, but the amount remains the same.
      If you have more questions, please call our toll free number at 1-800-772-1213, Monday through Friday between 7 a.m. and 7 p.m. and talk with one of our representatives. Thanks!

      , when we established your disability benefits, we

  26. I turned 62 this year and wanted to know if I could draw from my ex/spouse (whom is 75 years old and drawing his Social Security) retirement and me continue to work, and when I reach full retirement age draw from my own SS Retirement?? We were married over 35 years and have been divorced for 4 years.
    Thank you

    • Hello Sandy. If your birthday is January 2, 1954 or later, the option to take only one benefit at full retirement age no longer exists. If you file for one benefit, you will be effectively filing for all retirement or spousal benefits. Also, if you are eligible for retirement benefits on your own record and divorced spouse’s benefits, we will pay the retirement benefit first. If the benefit on your ex-spouse’s record is higher, you will get an additional amount on your ex-spouse’s record so that the combination of benefits equals that higher amount.
      See “Getting Benefits While Working” for information on this topic.
      We hope this information helps!

  27. I’m 64 and my spouse is 53, am I eligible for any of his benefits, besides my reduced benefits, if I retire now?

    Can I retire using just my spouse’s benefits then pick up my full amount at full retirement age?

    • Hello Mariam. A person may be able to get spouse’s retirement benefits if they’re at least 62 years of age and their spouse is receiving retirement or disability benefits. See “Benefits For You As A Spouse” for more information. Thanks!

  28. I going to be 60.00 year old, my ex husband died 10 years ago. I was married for 13 year. I can get something for his social security. I was divorced for 25 years

    • Hello Milagros. If you are the divorced spouse of a worker who dies, you could get benefits the same as a widow or widower, provided that your marriage lasted 10 years or more.
      Our system is set up to take applications four months in advance, and benefits are paid the month after they are due. So, for instance, if you want your benefits to begin with the month of November, you will receive your first benefit payment in December.
      You cannot apply for survivors benefits online. If you need to apply for benefits, call 1-800-772-1213 (TTY 1-800-325-0778). You can speak to a Social Security representative between 7 a.m. and 7 p.m. Monday through Friday. You can also visit your local Social Security office. An appointment is not required, but if you call ahead and schedule one, it may reduce the time you spend waiting to speak to someone.
      We hope this information helps!

  29. I’ve worked part time for 6 years while collecting SS DISABILITY . I will be 66 years old next year when my SS DISABILTY will change to SS RETIREMENT.
    Will the earnings over the past 6 years be included in the SS Retirement when calculating my monthly benefit resulting in a higher amount?
    Thank You.

    • Thank you for contacting us, Jane. First, Social Security disability benefits automatically change to retirement benefits when disability beneficiaries attain their full retirement age. Benefits are not interrupted with this transition and the benefit amount will generally remains the same.
      Full retirement age had been 65 for many years. However, beginning with people born in 1938 or later, that age gradually increases until it reaches 67 for people born after 1959.
      Also, disability benefits are paid at the highest rate possible, based on your earnings prior to becoming disabled. However, we review the records for all working Social Security recipients each year to see if an increase is due. See “Getting Benefits While Working” for more on this topic. Thanks!

  30. i draw my social secerity am 66 plus a retirement will it affect me on social secerity plus am still working will I be penalize

  31. Can I collect full retirement benefits(age 66) for a year, still work and then stop and restart at age 70 How will it effect the amount I will collect

  32. I have been given a projected social security payment i would receive at age 66 1/2. Is this amount dependant on my working until age 66 1/2 or can I stop working before that age and still receive the full amount when I apply for S.S. benefits at 66 1/2?

  33. THANK YOU! Although I’m not sure it would be higher, I qualify to receive social security benefits based on my ex-husband’s income. Social Security’s site says that I can receive on his once I reach full retirement age (67) and delay mine in order to get more later. I understand others to say that I would get a “combination” of the two and I would receive the higher amount. Which is true, can I delay mine and do I have to wait until FRA to draw on his? If I would be drawing totally on his at age 67 can I begin to draw mine at age 62 and change over to his at age 67 without affecting the amount I’d receive from his? The reason I’m asking is that we divorced when I was 50 (ten years ago), he illegally got all we’d worked for,…I got the clothes on my back, so I will never be prepared to retire. I think I may be able to collect SS and continue with my current job as I earn less than $17K, the annual income limit for under FRA. I have full benefits, but no longer pay into SS. (I pay into OPERS but just started last year.)

    • Hi, Cheryl. Thanks for your questions. To be eligible for divorced spouse’s benefits, you had to be married to your former spouse for at least 10 years, and you cannot be eligible for a higher benefit on your own record. Also, keep in mind, if you were born before January 2, 1954, and have already reached full retirement age, you can choose to receive only the divorced spouse’s benefit and delay receiving your retirement benefit until a later date. If your birthday is January 2, 1954 or later, the option to take only one benefit at full retirement age no longer exists. If you file for one benefit, you will be effectively filing for all retirement or spousal benefits. For more information, visit our Benefits Planner: If You Are Divorced. We hope this helps.

  34. Great article! All are valid points in preparing for retirement. I believe another retirement planning mistake that would make sense on the list would be, not getting out of debt. Would you agree? Debt can take a huge chunk out of your savings if not properly managed. It’s important that you get in front of it early before it gets out of control.
    Melvin Pritchett

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