To Retire Rich, Stop Chasing Huge Returns and Do This Instead, Courtesy of a Financial Planner

Forget gambling for high returns. Saving a large percentage of your income, minimizing taxes and keeping spending in check can offer a more realistic path to retiring rich.

By Eric Roberge, Certified Financial Planner (CFP) and Investment Adviser

published 1 January 2026

in Features

An older couple look relaxed on the sofa together.

I've been a professional financial adviser for 18 years. Nearly two decades in the industry have taught me what it takes to successfully build wealth and achieve ambitious financial goals.

If you follow the advice here, you'll give yourself a better shot at meeting your financial goals and retiring rich.

Pick the right investment strategy (and risk level) for your goals

When you're not wealthy yet, it can feel tempting to swing for the fences with your money in order to make more of it quickly.

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The problem with "swinging for the fences" is that striking out means losing time and money, both of which you could struggle to make up for (especially as you get closer to the point at which you want to stop working).

About Adviser Intel

The author of this article is a participant in Kiplinger's Adviser Intel program, a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

You don't need to earn the absolute biggest return possible. You need to earn enough to reach your specific goals, and participating in the market is sufficient to achieve that. You don't have to try to beat the market, and in fact, you likely shouldn't.

Why? Because the risk of trying and failing (and literally losing the money you need to achieve your retirement goal) is too great.

A good investment portfolio for a long-term investor who wants to build wealth for retirement should prioritize diversification (of asset classes, market sectors and economies around the globe), which helps reduce volatility and overall investment risk.

It should also avoid concentrated positions which rely more on luck than strategy to pay off, and introduce needless risk of loss.

Prioritize your savings rate (not your investment return)

Attempting to earn massive returns with your investments requires far too much risk that most people can't actually afford to take. Focusing on very aggressive rates of return also distracts you from a more powerful force: your own savings rate.

Simply saving a larger percentage of your income every year — for example, 25% instead of 10% — will do more to empower you to build wealth than crossing your fingers and hoping big bets in the stock market eventually pay off (and being devastated by losses when the downside risk shows up).

To illustrate this, someone earning $100,000 a year with income growth of 5% annually, saving 25% of that income, would have $1.467 million at the end of 20 years, assuming a 6% average rate of return.

This rate is quite modest and very reasonable to assume. But if someone earning the same amount saved only 10% of that income, they'd need a whopping 14% average rate of return from the market to get to the same level of wealth over 20 years, which is highly unrealistic to achieve over that period of time.

Aiming for that high of a return also introduces much more volatility into your portfolio, which, in the end, will net out with a smaller average return (even if you had some major outsized years in the mix).

Simply saving more will do more for your nest egg than gambling with it in hopes of outsized market returns that are more likely to end in losses.

Be mindful of taxes

People get very obsessed with investment fees, but pay little attention to taxes. But taxes will eat away much larger percentages of your money if you don't manage them correctly.

Make sure your assets are diversified across a variety of accounts that receive preferential tax treatments for your retirement years.

This means getting some portion of your nest egg into Roth accounts and leveraging vehicles like health savings accounts, which allow you to contribute pre-tax dollars, invest the money for tax-free growth, and use the funds from the account tax-free on qualified expenses.

Other strategies that can help you retire rich because you kept more money in your pocket than you gave to the IRS include:

Making the maximum contribution to tax-deferred accounts, such as 401(k)s, each year
Organizing your charitable contributions to increase deductions, while also reducing unrealized gains, through donating appreciated shares
Performing backdoor Roth conversions and leveraging mega backdoor 401(k) strategies
Implementing tax loss harvesting strategies, especially during significant stock market drops so you can capture capital losses to offset future capital gains

Maintain a gap between what you earn and what you spend

All the financial advice in the world won't do you a bit of good if your lifestyle exceeds your ability to pay for it — or even if your lifestyle just keeps pace with your income.

The more you spend, the more assets you'll need to support yourself in retirement and the less you'll have to save to create those assets. It's a formula for failure.

Keep your cash flow under control and be extremely cautious about plugging in large, fixed costs or letting spending slowly balloon. Pay yourself first by contributing to savings, then look to spend what's left over.

Pay attention to the little stuff

Most of my advice can be distilled down to: spend less, save more, invest those savings by taking just enough risk to meet your goals but no more than that. But there are a lot of other ideas that can help you build wealth and retire rich.

Here's what I'll leave you with in hopes of helping you manage your money with more success over time:

Don't DIY your way into unforced errors. Working with professionals on your financial and tax situations in some capacity can help you uncover blind spots, avoid mistakes and uncover opportunities. Small mistakes you didn't notice compound into big, costly messes over time.

Optimize for increasing your income. While you need to keep your spending under control, cutting costs to extremes comes with diminishing returns. Increasing your earnings will allow you to afford more lifestyle spending while giving you money to save and invest.

Be consistent with implementing actions or strategies with your finances and investments. Get proactive where you can (rather than just reacting after things already happened). Make a plan and then execute it consistently.

Eric Roberge, CFP®, is the founder of Beyond Your Hammock, a Boston financial planning firm that provides wealth management strategies to couples and young families. To jumpstart your financial planning journey, request a complimentary consultation with BYH here.

Disclaimer

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Eric Roberge, CFP®, is the founder of Beyond Your Hammock, a financial planning firm working in Boston, Massachusetts and virtually across the country. BYH specializes in helping professionals in their 30s and 40s use their money as a tool to enjoy life today while planning responsibly for tomorrow.

Eric has been named one of Investopedia's Top 100 most influential financial advisers since 2017 and is a member of Investment News' 40 Under 40 class of 2016 and Think Advisor's Luminaries class of 2021.