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How much money do you really need to retire without losing sleep at night? If you think your 401(k) alone will cut it, think again: One wrong move in the market could put your retirement plan to sleep.

But figuring out how much you’ll need to enjoy your retirement isn’t simple. Costs can add up quickly between healthcare, housing, groceries and maybe even a vacation or two.

And the reality? Everyone’s “magic number” is a little different. In fact, Northwestern Mutual (1) found in 2025 that the average American believes they will need $1.26 million to retire comfortably, though most are well behind that goal. Also, blindly investing in the stock market without building a safety net can be a problem if you plan to retire at a specific age, and the market is down.

This is something personal finance icon Suze Orman understands well.

“It’s not always that stocks go down and bonds go up, or bonds go down and therefore stocks go up. Sometimes everything can go down,” Orman said. Women and money podcast (2).

If you’re looking for a solid starting point, here are Orman’s rules to help you sleep well, though his magic number (3) might surprise you, especially compared to the $1.26 million golden ticket.

Orman shared his thoughts on the retirement amount on his podcast. His advice is to play defense, especially in unpredictable markets.

His first rule: Don’t rely solely on your 401(k) or IRA. Both are closely tied to stocks, and the market doesn’t always play nice.

Translation? If your retirement plan is riding the market’s roller coaster, you could be in for a steep drop when you expect smooth sailing. To soften the blow, Orman recommends keeping three to five years’ worth of living expenses in a liquid, low-risk account, such as a high-yield savings or checking account.

That means your retirement savings should be higher than Northwestern Mutual’s cap of $1.24 million, as long as you think it aligns with your living situation. If you spend $50,000 a year on expenses, that means adding $150,000 to $250,000 to your retirement goal so you have the flexibility to time your exit.

The “just in case” cash fund recommended by Orman should not be tied to the market. That way, you’re not forced to sell investments at a loss just to cover rent or buy groceries.

“If you really want to be sure, it’s five years,” Orman said.

It’s worth noting that Orman has a bullish view of the US market for 2026. In a January 2026 podcast episode (4), he said: “I think the US remains the place of the most extraordinary opportunity out there… You have to leave politics out of the decisions you make with money.”

He noted that while many investment advisers are looking for investment stability overseas, he believes the U.S. market will remain strong through 2026. “I’ll keep my money at home. Simple as that.”

If you think this is your year to get your finances together, here’s how to start building an emergency fund.

Read more: Approaching retirement with no savings? Don’t panic, you are not alone. here they are 6 Easy (and Fast) Ways to Catch Up

Building a solid cash cushion isn’t just about peace of mind. Having funds readily accessible can help you navigate emergencies, smooth your cash flow, and even take advantage of surprise investment opportunities.

Ideally, building an emergency fund means you won’t have to tap into your investments to handle a crisis. Most advisors suggest banking at least three to six months of cash. Then you can start focusing on reaching your retirement benchmarks, unless you prefer Orman’s three to five year minimum.

A good place to start is with a high-yield savings account.

These offer better interest rates than traditional savings accounts, so your money works harder while staying liquid. In addition, they are usually insured by the Federal Deposit Insurance Corporation. This means that qualifying high-yield accounts are protected against bank losses of up to $250,000 and sometimes more through partner banks.

Although the national average interest rate on US savings accounts is 0.39% APY (5), online banks can offer you better returns.

For example, a high yield account like a Wealthfront Cash Account can be a great place to grow your emergency fund, offering both competitive interest rates and easy access to your cash when you need it.

A Wealthfront Cash account currently offers a base variable APY of 3.30%, and new customers can earn a 0.65% increase in their first three months for a total APY of 3.95%. That’s ten times the national deposit savings rate, according to the FDIC’s January report.

With no minimum balances or account fees, as well as 24/7 withdrawals and free domestic bank transfers, your funds remain accessible at all times. Also, Wealthfront Cash account balances up to $8 million are insured by the FDIC through program banks.

Whether you plan to retire at 55 or 65, an essential part of the process is trying to be as debt-free as possible in your golden years. If you are struggling to pay your debts, the two most common methods of dealing with these payments are the avalanche and snowball techniques.

The avalanche method focuses on paying off your highest interest debts first. This can create a cascading effect where, after you pay off the big debt, you quickly eliminate the smaller ones. Meanwhile, the snowball method starts with paying off your smaller debts one after the other to build steam.

Then, once you get rid of a single debt, put all your resources into paying it off. From there, it might be a good idea to channel the money you were putting towards paying off your debt into building an emergency fund or your retirement savings.

Regardless of Orman’s optimism for 2026, it must be said that no one can always predict how the market will fluctuate. If you’re worried about the stock market falling, one way to protect yourself is by diversifying out of stocks and bonds.

This is typically where alternative assets such as precious metals, real estate or private equity come into play. A certain yellow precious metal has also been on an all-time bull run until recently, and despite a correction in late January, is still up around 60% year-to-date (7).

If you want to test yourself, you can work with (Priority Gold)(https://moneywise.com/c/1/463/2022?placement=4), an industry leader in precious metals, for physical access to gold and silver. Priority Gold offers free insured shipping and storage for up to five years through its Priority Platinum package.

They also offer a 100% free rollover from an IRA to a gold IRA, if you want gold to be a bigger part of your retirement plan. Qualifying purchases may be received up to $10,000 in free silver

To learn more about how Priority Gold can help you reduce the impact of stock market fluctuations on your nest egg, you can download its Free Gold Investors Pack 2026 to learn more Note that gold is often best used as part of a well-diversified portfolio.

Don’t panic if you’re close to retirement and your savings aren’t quite where you want them to be. In some cases, delaying retirement by even a year or two can make a big difference. You’ll have more time to save, fewer years to finance, and you can increase your Social Security benefits in the process.

In addition to noting that many Americans think they’ll need $1.26 million to retire, Northwestern Mutual broke down how much you should invest at different stages of your life to reach that goal. If you’re in your 20s, that number is just $330 a month, but for 40-year-olds, it rises to $1,547 a month.

This highlights the power of starting young and saving consistently. If you’re just starting out or looking for a savings strategy, you can work with an automatic investment service to take advantage of relatively safe bets like index funds or ETFs.

For example, with acornsany purchase with your credit or debit card will be automatically rounded to the nearest dollar. The excess, coins that would otherwise end up as loose change if you paid cash, goes into a smart investment portfolio. So that $4.25 a day coffee? Now that’s a 75 cent investment in your future.

But these summaries are only part of the puzzle. Aglans lets you too set up a recurring monthly deposit from your checking account to your savings or investment account, to help you build a nest egg without even thinking about it. It’s one of the easiest ways to stay consistent and avoid spending that extra money.

And the best part? If you sign up for a monthly automatic deposit, Acorns can help you get started with one $20 signup bonus.

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Northwestern Mutual (1); Women and Money (2), (4); Nasdaq (3); ; Federal Reserve Bank of St. Louis (5); @SuzeOrman (6); APMEX (7)

This article provides information only and should not be construed as advice. It is provided without any warranty.