As life expectancy increases, many American workers are rethinking their approach to saving and investing for retirement.
Finance expert and motivational speaker Tony Robbins acknowledges this reality and emphasizes a key strategy involving 401(k) plans and Individual Retirement Accounts (IRAs) to make the prospect of longer lives something to celebrate rather than fear.
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Relying solely on Social Security for financial security in retirement is not a wise course of action — especially considering how extended lifespans are lengthening the amount of time people spend on this planet beyond their working careers.
According to Robbins, an average retirement lasted near 12 years, half a century ago. Today, it is common for it to stretch beyond 20 years.
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Importantly, the Center for Retirement Research (CRR) has found that about half of U.S. households risk falling short on funds needed to sustain their current standard of living in retirement.
Robbins encourages Americans to assess their 401(k) and IRA options early in their careers and make informed financial choices that can support a stable future.
He offers some key thoughts on this subject for the many workers trying to find a way to sort it all out.
Personal finance author and motivational speaker Tony Robbins is pictured. Robbins encourages U.S. workers to participate in their employer-sponsored 401(k) plan and explains his view on why Roth IRAs are more effective retirement savings tools than traditional IRAs.Â
Tony Robbins explains key advantage of Roth 401(k) plans
Robbins advises workers to take full advantage of any 401(k) contribution matching offered by their employers, as it’s essentially free money that can significantly boost retirement savings.
For those with the option to choose a Roth 401(k) — which allows people to pay taxes up front so they can withdraw funds tax-free in retirement — he strongly recommends doing so.Â
His reasoning is simple: Robbins believes one’s taxes are likely to be higher during retirement. If that assumption holds true, then it would be smarter to pay them at today’s lower rates rather than later.
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Making proactive decisions about investing in defined contribution (DC) plans — such as 401(k)s — is especially important given the long-term impact of financial hardships Americans have experienced going back to the financial crisis of 2008.
“Households’ retirement preparedness in all income groups was heavily affected by the Great Recession,” the CRR found. “The middle and the highest thirds saw significant improvement from 2010-2019 due to rebounding housing and equity prices. In contrast, households in the bottom third saw virtually no improvement as they are less likely to own a house and participate in DC plans, and have few financial assets.”
Related: Shark Tank’s Kevin O’Leary warns Americans on Social Security problem
Tony Robbins encourages Americans to use a Roth IRA
In his book, “Money: Master the Game,” Robbins wrote that he frequently receives questions about whether setting up a Roth IRA is a smart move for retirement planning. His stance is clear — it’s a resounding yes.
A Roth IRA, much like a Roth 401(k), requires individuals to pay taxes on their contributions up front. The benefit? Again, once retirement arrives, withdrawals come free of tax burdens, offering financial flexibility in later years.
In 2025, contribution limits for Roth IRAs are set at $7,000 for those under 50 years old. Those aged 50 and above can make an additional $1,000 catch-up contribution to bolster their retirement savings.
However, income eligibility plays a role in determining how much one can contribute. To contribute the full amount, an individual’s modified adjusted gross income (MAGI) must be below $150,000. For married couples filing jointly, the threshold is $236,000.
Robbins emphasizes that taking advantage of these accounts is a strategic move, helping investors secure their financial future while making tax-efficient decisions.Â
As mentioned above, with lifespans growing longer, preparing for retirement with the right tools — especially tax-advantaged accounts such as Roth IRAs — can turn financial uncertainty into a well-planned, secure future.Â
Those who are eligible should strongly consider leveraging these opportunities as they strive to build a rewarding retirement.
