Guest Bloggers

What Is the Biggest Retirement Planning Mistake?

April 20, 2017 • By

Last Updated: April 20, 2017

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.

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About the Author

Suze Orman is an award-winning personal finance expert.


  1. Jane C.

    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.

    • Ray F.

      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!

  2. Milagros B.

    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

    • Ray F.

      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!

  3. Mariam

    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?

    • Ray F.

      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!

  4. Sandy C.

    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

    • Ray F.

      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!

  5. William H.

    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.

    • Ray F.

      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

  6. Marquita E.

    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.

    • Ray F.

      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!

  7. Barbara L.

    How do I calculate on ex spouse?

    • Ray F.

      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.

  8. Betty

    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

    • Ray F.

      Hi Betty, our fact sheet “Special Payments After Retirement” describes some of the more common types of special payments. For further assistance call our toll free number at 1-800-772-1213 and speak to one of our agents. Representatives are available Monday through Friday, between 7 a.m. and 7 p.m. Or visit your local Social Security office. Thanks!

  9. Elizabeth T.

    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.

  10. khóa c.

    very nice

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