After years of hard work, retirees deserve financial security — but staying ahead requires strategic money moves.
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Whether retirees want to grow their savings or protect what they’ve built, careful financial planning can make all the difference, said Melissa Murphy Pavone, the founder of Mindful Financial Partners. “No matter where you are on your financial journey, it’s never too late to build a strong retirement foundation.”
Here are four smart moves retirees should make to build their retirement savings in 2025.
Keep More, Pay Less
One of the best moves retirees can make is to take advantage of tax-advantaged accounts like Roth IRAs or Health Savings Accounts.
“Investing in dividend-generating assets and exploring low-risk, long-term investments will help grow their savings steadily well beyond 2025,” said Christopher Stroup, CEO and founder of Silicon Beach Planning. “Roth conversions, tax-loss harvesting and utilizing deductions can help reduce taxable income and keep more money in their pocket.”
Christine Mueller Coley, a wealth advisor at SteelPeak Wealth Management, advised retirees to capitalize on today’s high interest rates.
“Utilize a high-yield savings account, and consider locking in rates on bonds or fixed annuities,” Coley said. “Understand that Social Security payments could change. There is talk of reducing COLAs (cost-of-living adjustments) and delaying or reducing Social Security benefits.”
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Wait To Withdraw Savings
Tom Buckingham, the chief growth officer at Nassau Financial Group, said retirees should consider waiting to withdraw money from their retirement savings accounts if they are no longer working full-time. “That will allow you to stay invested and continue to grow your retirement assets, whether you own stocks and bonds or purchase other products, like CDs or fixed annuities.”
If retirees must withdraw from their retirement savings, they should calculate their tax bracket first, said Melanie Musson of Clearsurance.
“If you’re just over a tax bracket, try to reduce your retirement savings withdrawals, so you stay in the lower tax bracket,” Musson explained.
Reduce Investment Risks
Retirees could see a wealth of new investment opportunities this year, especially as President Donald Trump recently launched business deregulations and, Financial Times reported, the private equity industry plans to advocate for its inclusion in 401(k) plans. While these developments may create new opportunities, retirees should focus on protecting their savings by rebalancing their portfolios.
“In practice, this means diversifying their portfolio with stocks and bonds,” Stroup said. “Retirees may benefit from inflation-hedged investments like Treasury Inflation-Protected Securities (TIPS) or real estate to diversify and stabilize their portfolio.”
Streamline Your Finances
According to research from the Employee Benefit Research Institute (EBRI), 68% of retirees reported having outstanding credit card debt, 31% said their spending exceeds what they can afford and half saved less than they needed for retirement.
However, retirees can regain control of their financial health by streamlining their spending and weighing the pros and cons of downsizing.
“Retirees could commit to making meals at home,” Musson said. “YouTube has a lot of helpful content to learn how to cook. Homemade meals cost a lot less than the same meal eaten out.”
Stroup suggested retirees periodically review and cut unnecessary subscriptions, which can free up a few hundred dollars each month.
“Ultimately, it’s important for retirees to focus on essential expenses while maintaining an emergency fund to cover unforeseen costs that could come in the future,” Stroup said.
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This article originally appeared on GOBankingRates.com: 4 Moves Retirees Should Make To Build Their Retirement Savings in 2025
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