I’m a Financial Advisor: 4 Money Moves That Could Screw Up Your Retirement Plans in 2025
Written by
Cindy Lamothe
Edited by
Zuri Anderson
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Entering into 2025 is likely to ignite all kinds of changes, especially when it comes to finances. But some money moves could actually be harmful to your long-term plans.
GOBankingRates spoke to Max Avery, chief business development officer at Syndicately, and Eric Mangold, certified wealth strategist and founder of Argosy Wealth Management, to discuss which financial moves could screw up your retirement this year.
If you are getting close to retiring, Mangold advised you to be cautious if you are considering large shifts in your strategy.
“First, if you are close to retiring, do you know exactly how much money you will need to fund your retirement on day 1?” he said. “You should know how much money is coming in the door from various sources like, but not limited to, your pension, social security, rental income, annuities, and investments.
“If you have done this analysis, does it show you ever running out of money in retirement? If so, you have some more work to do. Remember, running out of money before you run out of breath is not a good strategy.”
Below are the top money moves experts warn to avoid making.
Neglecting SECURE 2.0 Opportunities
According to Avery, the SECURE 2.0 Act introduced significant retirement changes, such as automatic 401(k) enrollment and higher catch-up contribution limits.
“Missing out on these could mean leaving valuable tax benefits and compounding growth untapped,” he said. “For instance, not taking advantage of catch-up contributions for individuals over 50 could result in a loss of up to $6,500 per year.”
Relying on Outdated Withdrawal Strategies
“I would mention that the traditional rules, like the 4% rule, may no longer apply in 2025 due to changing inflation and market dynamics,” said Avery.
He said blindly adhering to such outdated advice could either deplete your savings too quickly or leave you living too frugally.
“My advice is to customize your strategy with updated data like current market conditions, your health status and expected longevity,” Avery added.
Not Preparing for Healthcare Expenses
“I often see people underestimate the impact of healthcare costs on retirement savings,” Avery explained. “According to a Fidelity study, A 65-year-old couple retiring today is expected to spend approximately $12,800 on healthcare in their first year of retirement.”
He said it’s crucial to factor the rising cost of medical care into your retirement planning and consider options like long-term care insurance.
Overcommitting to Family Financial Support
“Helping adult children or extended family is generous, but overcommitting can derail your retirement plans,” Avery noted.
Co-signing loans, funding weddings or supporting a loved one’s business venture could leave you with less to live on.
“I recently read that 58% of parents have put their retirement savings on hold to support their adult children,” he said. “It is essential to set boundaries and prioritize your own financial security first.”
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