‘Sometimes, everything can go down’: Suze Orman says you need this much cash for retirement, and it’s more than most Americans expect

And the reality? Everyone’s “magic number” is a little different. In fact, Northwestern Mutual (1) found in 2025 that the average American thinks they’ll need $1.26 million to retire comfortably, though most are far behind that goal. What’s more, blindly investing in the stock market without building a safety net can be a problem if you’re planning to retire at a specific age, and the market just so happens to be 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 on her Women & Money podcast (2).

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

Orman’s magic number

Orman shared her thoughts about how much to retire with on her podcast. Her advice is all about playing defense — especially in unpredictable markets.

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

Translation? If your retirement plan is riding the market rollercoaster, you could be in for a sharp drop when you’re hoping for smooth sailing. To soften the blow, Orman recommends stashing away three to five years' worth of living expenses in a liquid, low-risk account — like a high-yield savings or a checking account.

That means your retirement savings should be higher than that $1.24M high water mark from Northwestern Mutual, provided you believe it aligns with your living situation. If you spend $50,000 a year in expenses, that means adding between $150,000 and $250,000 to your retirement target so you have the flexibility to time your exit.

Orman’s recommended “just-in-case” cash fund 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 wanna be on the safe side, it’s five years,” Orman said.

It’s worth noting that Orman has a bullish outlook on the American market for 2026. On an episode of her podcast from January 2026 (4), she said, “I think the United States is still the place of the most extraordinary opportunity out there … You have got to leave politics out of the decisions that you make with money.”

She noted that while many investment advisors are looking overseas for investment stability, she believes the U.S. market will remain strong in 2026. “I’m going to keep my money at home. Just that simple.”

If you feel that this is your year to pull your finances together, here’s how to begin building an emergency fund.

How to build your cash cushion

Building a solid cash cushion isn’t just about peace of mind. Having easily accessible funds can help you navigate emergencies, smooth out 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 manage a crisis. Most advisors suggest banking at least three to six months’ worth of cash. Then you can start focusing on hitting your retirement benchmarks, unless you prefer Orman’s three-to-five year minimum.

High-yield savings

A great 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 remaining liquid. Plus, they’re usually insured by the Federal Deposit Insurance Corporation. This means qualifying high-yield accounts are protected against bank-based losses of up to $250,000, and sometimes more through partner banks.

While the national average interest rate for U.S. 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 clients can get a 0.65% boost during 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 wire transfers, your funds remain accessible at all times. Plus, Wealthfront Cash Account balances of up to $8 million are insured by the FDIC through program banks.

Down with debt

Another key piece of Orman’s advice for retirement is to eliminate all debts before you leave work for good (6). This includes mortgages, car payments and high-interest debt like credit cards. Debt eats into your savings, and the interest you pay on borrowed money can quickly swallow up your monthly budget and make it difficult to plan for unexpected expenses — especially if you’re struggling to pay down the principal.

If you are buried in retail debt, Credible can help you consolidate various debts into one manageable payment.

Credible helps you find the lowest interest rates on loans up to $100,000. Instead of throwing away your hard-earned money on multiple interest payments, Credible can help you combine all your debt into one simple payment, so you don't have to juggle multiple lenders with different interest rates. This can help you get retirement-ready with less stress and more room for contributing to your savings.

Diversify — and spread your risk

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

Typically, this is where alternative assets like precious metals, real estate or private equity come into play. A certain precious yellow metal has also been on a historic bull run until recently and, despite a late-January correction, is still up about 60% year-over-year (7).

If you want to test your mettle, you could work with Priority Gold, an industry leader in precious metals, to physically access gold and silver. Priority Gold provides free insured shipping and storage for up to five years through their Priority Platinum Package.