5 Signs Your Retirement Savings Isn’t Enough To Last Through 2025
Written by
Kerra Bolton
Edited by
Zuri Anderson
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No matter your financial status, it’s crucial to assess your current expenses and whether your retirement savings are on track to support your lifestyle.
With rising housing, food and healthcare costs, more retirees are dipping into their nest eggs faster than expected.
“Everyone hopes for a smooth flight in retirement,” said Paul Tyler, host of “That Annuity Show.” “But sometimes the oxygen masks do drop from the ceiling.”
Here are five warning signs that your retirement savings aren’t enough to last through 2025 and what you can do about it.
You’ve Had Medical Emergencies
According to data from the American Hospital Association, U.S. residents owe at least $220 billion in medical debt.
About 6% of American adults (14 million people) owe over $1,000 in medical debt. Of those, three million (1%) have medical debt totaling more than $10,000.
“If you have any type of medical condition and don’t have good coverage, an extended stay in a hospital could prove financially catastrophic,” Tyler said.
“If you are on Medicare, make sure that you are on MedAdvantage or own a good Medicare supplement insurance plan.”
You’ve Experienced a Natural Disaster
The number of natural disasters has quadrupled since 1970, according to United Nations research. The study also found that the number of disaster events has increased from 100 per year in the 1970s to about 400 events per year worldwide in the past 20 years.
Last year alone, the U.S. experienced 28 weather and climate disasters, each costing at least $1 billion or more in damages.
“For most Americans, their home is their largest asset in retirement next to Social Security,” Tyler said. “If you live anywhere near a flood plain, get flood insurance from FEMA or consider moving to a different area of the country.”
Your Credit Card Debt Is Skyrocketing
Your retirement won’t be enough to last through 2025 if you find your credit card bills are increasing. Consumers carry an average of over $6,500 in credit card debt, Experian reported.
You may be treading financial waters if you are tapping into your retirement savings to pay off debt.
“Variable interest rates on credit cards hit record highs of over 20% a year in 2024,” Tyler said. “Skipping a few too many payments can quickly create debt you can’t outrun. Look for ways to pay off balances sooner rather than later.”
Experian recommended starting by calculating your owe and listing the balance and interest rate for each card. Once you know your owe, you can choose a debt strategy, such as starting with the card with the lowest balance first or targeting accounts with the highest interest rates.
You Withdraw Too Much
Credit card debt and spending more than you make are telltale signs of having an unrealistic retirement lifestyle.
“If you are withdrawing more than 4% of your retirement income in 2024, make it a point to pull back before next year,” Tyler said.
“If you aren’t sure how much money you can withdraw, consider putting some of your savings in an annuity with a monthly check to remove the guesswork.”
You Have Risky Investments
The riskiest investments have the greatest potential for gains and losses.
According to Nationwide, stocks statistically outperform other investment vehicles over time. However, you can also invest in mutual and exchange-traded funds that tie to bonds, precious metals or “slow-growth” companies.
In addition, Tyler recommended diversifying your investments to buffer yourself against the downturn of risky investments.
“You are the most at risk for running out of money when you have stopped working and are making withdrawals from your savings accounts,” Tyler said. “A big dip in the market can have an enormous impact in future years.”
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