Most Asked Financial Questions of 2025, #285
2025 has been a year of significant highs and lows, a bittersweet time marked by personal loss but also tremendous growth in our community of listeners and clients. As we wrap up the year, I wanted to take a moment to reflect and, more importantly, to give back by answering the most pressing questions on your minds.
In this episode, I’m tackling the top 10 most asked financial questions I received in 2025 from both clients and listeners. From the future solvency of Social Security and the reality of rising inflation to the specifics of Bitcoin and long-term care, we are covering the topics that directly impact your retirement confidence.
I also share a special thank you gift to you my listeners: a significant discount on my Retirement Readiness Review course to help you kickstart your 2026 planning. Whether you are wondering if you should pay off your mortgage or how to find a truly objective financial advisor, this episode provides the clear, direct answers you need to navigate your financial future.
You will want to hear this episode if you are interested in...
[00:00] Will Social Security be there for you when I retire?
[06:04] How to handle rising inflation in retirement.
[12:34] Should you be investing in Bitcoin in 2026?
[17:37] The pros and cons of paying off your mortgage early.
[21:51] Getting your children started with investing and saving.
[26:01] Protecting your investments during a market downturn.
Social Security Solvency: Should You Worry?
One of the biggest fears retirees face is the potential expiration of Social Security. The most recent trustees' report projects that benefits can be paid at 100% until roughly 2033. If no changes are made by then, benefits could be reduced by approximately 20%. However, history suggests that Congress will act to prevent such a drastic cut, especially given how heavily the average American relies on this income.
We also saw recent changes with the "Social Security Fairness Act" passed just before President Biden left office, which restored benefits for many teachers and state employees previously affected by reductions. While this adds strain to the system, it highlights the political will to support retirees.
Inflation and Investment Strategy
Inflation has been a persistent concern since the post-COVID stimulus era. For retirees on a fixed income, combating this is difficult because pensions and Social Security cost-of-living adjustments are automatic and out of your control.
The single best hedge against inflation is your investment portfolio. Historically, stocks are the only asset class that has significantly outpaced inflation over time. While this comes with volatility, maintaining an exposure to equities (often 50–70% for many retirees) is often necessary to ensure your purchasing power lasts as long as you do.
The "Retirement Number" Formula
Forget the arbitrary goal of saving "$1 million" or "$2 million." Retirement planning is about paycheck replacement. To find your number:
Calculate Expenses: Determine your monthly spending needs in retirement.
Subtract Fixed Income: Deduct your expected Social Security and pension income from that expense number.
Determine the Gap: The remaining amount must come from your portfolio (401k, IRA, brokerage).
Apply the Withdrawal Rate: Using a conservative 4% withdrawal rate, determine if your savings can cover that gap.
Don't forget to account for taxes! You can use online calculators or work with a CPA to estimate your after-tax income.
Specific Asset Questions: Bitcoin and Mortgages
Bitcoin: Despite its popularity, Bitcoin remains a highly speculative asset. In 2025, while the stock market saw gains of 15-18%, Bitcoin was down significantly, highlighting its volatility. For most retirees, the risks outweigh the benefits when a standard diversified portfolio can already meet your income needs.
Mortgage Payoff: Emotional peace of mind often conflicts with financial math. If you have a low interest rate (e.g., 3%), rushing to pay off that "cheap money" rarely makes sense when you could earn 5% or more on your investments. Furthermore, taking a large lump sum from an IRA to pay off a house could trigger a massive tax bill and even IRMAA surcharges on your Medicare premiums.
Tax Planning: Roth Conversions and New Legislation
With the passing of the "One Big Beautiful Tax Act" in 2025, we have new opportunities for tax planning.
Roth Conversions: If you expect your future tax rate to be higher than your current rate, converting traditional IRA funds to Roth can save you money long-term.
New Deductions: The new legislation allows for a higher SALT (State and Local Tax) deduction cap of $40,000 until 2030, which is a huge benefit for those in high-tax states like Connecticut. This might create a unique window over the next few years to perform conversions more tax-efficiently.
Resources Mentioned
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