Workers should diversify retirement income sources beyond 401(k)s and Social Security.

From Yahoo Finance: 2025-04-20 08:30:00

A new retirement study from Schwab shows that 40% of workers expect their retirement income to come from their 401(k) accounts, up from 37% in 2022. Social Security is the next closest source at 20%. It’s crucial to plan withdrawals carefully and consider other sources like pensions and part-time work.

Schwab’s study also reveals that 40% of retirement income will come from one’s own 401(k) (32%) or a partner’s (8%). Workers need to rely on a variety of sources to cover living expenses in retirement. Besides 401(k)s, other sources include Social Security, savings, investments, pensions, part-time work, annuities, and insurance.

It’s essential to start planning early and review all potential sources of retirement income to supplement 401(k) withdrawals and Social Security. A financial advisor can help you create a personalized retirement plan that considers your goals, circumstances, and tax strategies. Planning ahead can ensure a comfortable retirement and peace of mind.

To make the most of your retirement income, consider factors like taxes and unexpected expenses. Having a liquid emergency fund in a high-interest account can help cover unforeseen costs without risking significant market fluctuations. Understanding tax laws and saving wisely can help you maintain financial stability in retirement.

Read more: Are You Overlooking Key Sources of Retirement Income?