Whether you are just entering the workforce or nearing retirement age, planning for the future is critical. -- Ron Lewis 

Mr. Lewis was right about how critical planning is when it comes to your future financial security. Leaving it to chance is not likely to end well, especially if you're not expecting to collect Social Security. Fortunately, that situation may be less problematic than you would expect.

Crossing out Plan A and writing Plan B on chalkboard

Image source: Getty Images.

If you're not counting on Social Security benefits, here are three money moves you should make.

Find out if you really won't collect Social Security

For starters, find out if you're correct when you assume that you won't be eligible for any Social Security benefits. To qualify for benefits based on your earnings, you do need to have worked and earned a certain modest amount in at least 40 quarters, so many people easily qualify by working for 10 years. The more you work and earn, though, the bigger your benefits can be. The formula counts up to 35 years of work.

So if you worked mostly in the home or you just never received the paychecks or taxable income that could qualify you for benefits, what then? Well, if you're married, divorced, or widowed, you may be able to claim benefits based on your current, ex-, or late spouse's earnings record -- generally receiving between 50% to 100% of the spouse's benefit. (Divorcees will need to have been married for at least 10 years and not have remarried.)

Even if you do end up with Social Security income, it may not be as generous as you'd like. Thus, it's worth looking into some of the many ways you can maximize Social Security, in order to get bigger checks.

lots of dollar bills raining down from a blue sky

Image source: Getty Images.

For maximum financial security, save aggressively

Whether you are or aren't collecting Social Security income, you'll probably still need additional funds to live off of in retirement, so it's smart to be socking money away and investing it sensibly throughout your working life. The table below shows how much you can accumulate by making big annual contributions to IRAs, 401(k)s, and/or other retirement savings accounts over as many years as possible.

Growing at 8% for

$5,000 invested annually

$10,000 invested annually

$15,000 invested annually

10 years




15 years




20 years




25 years



$1.2 million

30 years


$1.2 million

$1.8 million

Calculations by author.

It's not enough to just save aggressively. You also need to be investing in ways that are likely to give you reasonable growth in exchange for a reasonable degree of risk. Super-safe investments can seem smart, but if they don't grow much over time, they can underserve you. Government bonds, for example, might be appealing because they're so safe, but right now they're sporting puny yields -- around 2.3% for 10-year bonds and 2.9% for 30-year ones.

The table below illustrates what a difference your money's growth rate can make, showing what annual investments of $10,000 can grow to:

Growing for

Growing at 4%

Growing at 8%

Growing at 10%

15 years




20 years




25 years



$1.1 million

30 years


$1.2 million

$1.8 million

Calculations by author.

For long-term money, it's hard to beat the stock market, which you can invest in easily with an index fund such as the SPDR S&P 500 ETF.

man in suit lying back on a background of US currency bills, arms behind his head, eyes closed, smiling

Image source: Getty Images.

Plan for alternative retirement income streams

As you approach and enter retirement, you can set up some income streams to provide regular funds, just like Social Security would. Instead of selling off shares of stock from your stock portfolio over time, you can fill your portfolio with lots of dividend-paying stocks that offer income without your having to sell any shares. As an example, a $300,000 portfolio that sports an overall average yield of 4% will generate about $12,000 per year -- a solid $1,000 per month. Dividend income isn't guaranteed, but if you spread your money across a bunch of healthy and growing companies, you'll likely receive regular -- and growing -- payments. Here are a few well-regarded stocks with significant dividend yields:


Recent Dividend Yield

National Grid PLC


Verizon Communications


Telefonica SA 


General Electric 




Source: Yahoo! Financial.

A dividend-focused exchange-traded fund (ETF) can serve you well, too, offering instant diversification. The iShares Select Dividend ETF, for example, recently yielded about 3.1%. Preferred stock is another way to go. The iShares U.S. Preferred Stock ETF recently yielded 5.3%.

Another good way to create an income stream in retirement -- and one you don't have to manage -- is to invest in an annuity or two. While some annuities, such as variable annuities and indexed annuities, can be quite problematic, often charging steep fees and sporting restrictive terms, fixed annuities are well worth considering. They're much simpler instruments, and they can start paying you immediately or on a deferred basis. Below are examples of the kind of income that various people might be able to secure in the form of an immediate fixed annuity in the current economic environment. (You'll generally be offered higher payments in times of higher prevailing interest rates.)



Monthly Income

Annual Income Equivalent

65-year-old man




70-year-old man




70-year-old woman




65-year-old couple




70-year-old couple




75-year-old couple




Source: immediateannuities.com.

A deferred annuity can also be smart, one that starts to pay you at a future point, such as when you turn a certain age. A 60-year-old man, for example, might spend $100,000 for an annuity that will start paying him $952 per month for the rest of his life beginning at age 70. That can remove any worries about running out of money late in life.

Whether you will or won't be receiving Social Security benefits in retirement, know that the average monthly Social Security retirement benefit was recently $1,368, which amounts to $16,416 per year. If you do expect benefits, consider learning about strategies to get the most out of the Social Security program.