Suze Orman’s Controversial Advice for Retirement Most Retirees Can’t Achieve

During a recent episode of her "Women & Money" podcast, famed financial advisor Suze Orman gave some controversial advice about the best ways to maximize your retirement savings.

The advice, which suggests that retirees should put enough cash to cover living expenses for several years into easy-to-access savings accounts, struck many as surprising, and not all financial experts agree.

Here's a breakdown of what Orman suggested, what other financial experts say, and how to go about fleshing out your savings for retirement.

Orman suggested that retirees set aside three to five years' worth of living expenses in a "just in case" fund, and her comments had many rethinking their retirement readiness. This money, she said, should be set aside outside of the stock market so it is not affected by crashes.

"If you really want to be on the safe side, it's five years," she said, pointing to three as the minimum, which is still significantly higher than the standard recommendation for retirees.

Orman suggested that the three- to five-year cushion is necessary because it acts as security in the event of a crash that takes years to stabilize.

"What if the market has crashed at the time that you want to [access cash during retirement]," she said. "It's not always that stocks go down and bonds go up or bonds go down and, therefore, stocks go up. Sometimes everything goes down."

Having a cash cushion gives retirees the stability to ride that out.

Planning to have a cash cushion that covers three to five years of expenses is nice in theory, but it's a milestone that is nearly impossible for many Americans.

In early 2025, the average Social Security payment for American retirees was $1,976 a month, and a large swath of retirees depend on that check to make ends meet.

These large cash cushions are clearly not easy to achieve.

Some financial advisors are in Orman's camp and support having that big rainy day fund in case you need to ride out a chaotic market in retirement. However, many experts consider this unrealistic for most savers.

A popular savings alternative is the "bucket strategy," which encourages people to create three different buckets for immediate needs, short-term savings goals, and long-term planning to diversify retirement savings and meet different needs.

If you are tempted by this idea of being immune (or at least safer) from market volatility and want to follow Orman's advice, it is wise to start small rather than completely shifting your focus to liquid savings.

More general advice suggests retirees should have about a year or two years' worth of expenses available. This slightly less ambitious goal is a good place to start, and can be achieved with smaller tweaks to your budget and savings strategies.

Once you decide on a savings goal for your "just in case" fund, you will need to weigh the pros and cons of each storage option, from high-yield savings accounts (HYSAs) to money market accounts.

HYSAs typically offer better interest rates than other savings accounts and are a great option for emergency funds for both immediate needs and short-term savings needs. Certificates of Deposit (CDs) also offer solid interest rates, but they typically have stricter rules about how long money has to sit and when you can touch it without penalty.

Money market accounts offer many of the perks of savings accounts, can have very high returns, and often make it easier to access cash due to debit and check-writing features.

If Orman's guidance on how much to save seems out of the realm of possibility, you are certainly not alone, but there are small savings steps you can take to get yourself in better shape before retirement.

You can make sure your retirement savings are diversified. Try to lower your living expenses so that you can put aside small savings each month. Delay taking Social Security so that the checks you do eventually receive are bigger, or even consider picking up a side hustle for a few hours a week to earn extra income outside of work.

Orman's advice highlights the importance of having cash available should unexpected expenses or market volatility come up during retirement, but it is not a one-size-fits-all approach. Prepare, but stay realistic.

To set yourself up for retirement, balance is key. Having cash in easily accessible places like a HYSA or a money market account certainly plays a role, but allowing money to grow in investment accounts does as well.

Workers approaching retirement should consider consulting a financial planner to figure out which approaches align the best with their earnings and savings goals long-term.