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Kevin O’Leary has a number he loves to repeat: $5 million in the bank to retire. He first floated it in a 2023 YouTube video — the amount, he said, that you need to weather anything the economy throws at you.
He doubled down in a 2024 interview with the Financial Post, calling $5 million “the minimum” (1).
I’ve been a CPA since 1981, and I’ve helped people run their retirement numbers for decades. So I’ll say it plainly: for the vast majority of Americans, that figure isn’t just wrong. It’s discouraging nonsense.
Consider the math. The average retired worker collects about $2,080 a month from Social Security (2). And surveys say most people think they need around $1.46 million to retire comfortably — already a fraction of O’Leary’s number, yet retirement confidence still sits near its lowest in years (3).
So what do you really need? Almost certainly far less than $5 million. Here are five moves to find your real number — and make it last.
1. Your real number is smaller than you think
Forget the headline figures. Your number comes down to one thing: the gap between what you’ll spend and what Social Security and any pension already cover.
The average retiree household spends about $5,100 a month, according to the latest federal data. Subtract your Social Security, and what’s left is the gap your savings have to fill.
There’s a quick rule for that gap: multiply it by 25. A $40,000-a-year gap means roughly $1 million in savings — not $5 million. Here’s the full math.
Read Next: 11 Financial Lies You Really Need to Stop Telling Yourself
2. Don’t guess your number — pin it down
Most people never run this math. They grab a scary figure off the TV, decide they’ll never hit it, and give up. That’s exactly how a number like $5 million does real damage.
Here’s an idea: Talk to a pro. A good advisor can calculate your actual target in an afternoon — including Social Security timing and taxes, which is where most do-it-yourself plans quietly leak money.
Then there’s investment returns. A Vanguard study shows DIY investors turn $500K into $1.7 million over 25 years – while those with advisors reach $3.4 million. You could be missing half your potential wealth.
So getting a second set of eyes could be a good idea. And these days it’s easier than ever.
For example, SmartAsset instantly matches you with up to three fiduciary advisors – legally required to prioritize your interests. They spot tax savings, Social Security strategies, and planning gaps you’d never see alone.
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Stop Leaving Money Behind – Get Matched Free3. Make the savings you do have work harder
If you’ve got savings, don’t let it sit in a big-bank account paying almost nothing. Over a retirement that can last 30 years, the gap between earning nothing and earning a real yield adds up to serious money.
Switching to a better bank account is one of the easiest edges out there.
If you’re still at a traditional brick-and-mortar bank, you may be paying monthly checking fees while earning almost nothing on your savings.
SoFi offers a combined checking-and-savings account with no account fees, and with eligible direct deposit you can earn up to 3.80% APY on savings — many times the national average. (APY is variable and can change at any time.)
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Quick gut-check — if your money advice is coming from random online influencers, you’re playing a dangerous game. I’ve been a CPA since 1981 and writing about money since before the internet existed. Sign up for the free Money Talks Newsletter and get expert advice that’s been tested by time.
4. Don’t overlook the biggest asset you own
For most retirees, the largest asset isn’t a brokerage account — it’s the house. If you’re equity-rich but cash-poor, that home can become part of your income plan instead of just sitting there.
If you’re 62 or older, the equity in your home could become cash you can use now. A reverse mortgage lets eligible homeowners convert part of their home equity into funds — while keeping ownership of their home.
What it could help you do:
Free up your monthly budget with no required monthly mortgage payment*
Cover everyday expenses or build an emergency cushion
Make home improvements
Fund the retirement lifestyle you want
See how a reverse mortgage works and whether you qualify.5. Stop overpaying on the bills you already have
Remember, your number is just your annual spending gap times 25. So every recurring bill you trim shrinks the savings you need — permanently, not just once.
Car insurance is the easiest place to start, because most people never shop it. They just pay whatever the renewal notice says.
Insurers count on you being too busy to shop around. But Insurify has fixed that.
Unlike other sites that sell your data, Insurify lets you compare real-time quotes side-by-side without the spam. It takes minutes to check, and it costs you nothing.
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Check it out right nowThe bottom line
It’s unlikely you need $5 million to retire. In fact, O’Leary himself has said the opposite. In a LinkedIn post, he pitched living off just $500,000 “and do nothing else” — coasting on the interest plus your Social Security (4).
So which is it: five million or half a million?
The truth is there’s no magic number that fits everyone. Yours depends on what you spend, what you’ve saved, and what you want — not on what a TV personality says to get publicity.
Run your number. It’s almost certainly smaller — and closer — than you think.
Sources: Benzinga (1); Kiplinger (2); Kiplinger (3); Yahoo (4).
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