BUSINESS

Fact checked by Suzanne Kvilhaug

If you’re expecting your 2024 federal tax refund to arrive in the mail, it might be the last time you get a paper check from the Internal Revenue Service (IRS). Under a new executive order signed by President Donald Trump, the U.S. Treasury will stop issuing all paper checks by Sept. 30, 2025, including for tax refunds.

That means going forward, most taxpayers will need to receive their refunds electronically through direct deposit, a debit card, or other digital payment methods. If you’re not prepared, your next refund could be delayed—or worse, never arrive.

Key Takeaways

• Starting in September 2025, the IRS will no longer issue paper checks for tax refunds.
• Refunds will be issued via direct deposit, prepaid debit cards, or digital wallets, unless you qualify for one of the limited exceptions.
• To avoid delays, taxpayers should confirm their banking information and update their payment preferences with the IRS now.

Why Is the IRS Eliminating Paper Checks?

According to the White House, the move to digital payments is all about making government payments more efficient, affordable, and secure.

“President Trump is cracking down on waste, fraud, and abuse in government by modernizing outdated paper-based payment systems that impose unnecessary costs, delays, and security risks,” stated the White House fact sheet about the March 25 executive order.

From a practical and economical standpoint, digital payments are the way to go in the modern age. Electronic transfers are much faster than printing and mailing a check, and maintaining the infrastructure to process and digitize paper reportedly costs taxpayers more than $657 million in 2024.

There’s also the security factor. U.S. Treasury checks are 16 times more likely to be lost, stolen, or tampered with compared to electronic transfers. Meanwhile, check fraud is rising: A 2025 survey by the Association for Financial Professionals found that 63% of organizations experienced check fraud in 2024. Going digital is expected to reduce those risks significantly.

How Will American Taxpayers Get Their Refunds?

Starting in fall 2025, all tax refunds will be issued using electronic funds transfer (EFT) methods. That includes direct deposit into a bank account, prepaid debit cards, or digital wallets.

The IRS will no longer issue paper refund checks unless you qualify for a specific exception, including:

• Taxpayers who don’t have access to a bank account or digital payments.
• Emergency payments where electronic payments would “cause undue hardship.”
• Security or law enforcement-related cases where non-electronic transactions are “necessary or desirable.”

In these instances (and any other circumstances where the Secretary of the Treasury deems it necessary), the Treasury will make accommodations for an alternative payment method.

Can You Still Pay Taxes by Mail?

In most cases, no. The government is phasing out incoming paper payments, too. That means if you’re currently paying your taxes, fees, or fines by check, you’ll need to start doing so by card or digital wallet beginning later this year, unless you qualify for one of the limited exceptions outlined in the executive order.

How to Prepare for the Treasury’s Paper Check Phase-Out

If you normally receive your tax refund via check, now’s the time to set up an electronic payment method. Here’s how to prepare:

• Set up for electronic payments: If your next tax return indicates that you are owed a refund, opt for direct deposit or another digital payment method when you file.
• Update your bank account information: The IRS has your information on file. Use the agency’s “Where’s My Refund?” tool to manage your payment preferences.
• Open accounts: If you don’t have a checking or savings account, consider opening one or exploring prepaid debit card options. According to the executive order, the Treasury will work with financial institutions and consumer groups to support unbanked and underbanked Americans through this transition.

Taxpayers who meet one or more of the exemption criteria will need to apply for an exception through the Treasury. Guidance on how to do this has not yet been issued at the time of writing.

The Bottom Line

The end of paper refund checks marks a major shift in how Americans receive money from the government. If you rely on paper checks for your refund, take steps now to update your payment method before the Treasury’s September 2025 deadline. Getting ahead of the curve will help ensure your next refund arrives quickly, securely, and without issue.

Fact checked by Vikki Velasquez

Many people fell behind financially due to the COVID-19 pandemic, and some have not yet recovered. However, between 2019 and 2024, millennials managed to amass wealth at a pace that surpassed previous generations at their age.

What was once seen as the financially burdened generation is now leading a wealth revolution.

Key Takeaways

• Between 2019 and 2024, millennials’ net worth increased by about $12 trillion.
• The financial growth of millennials over the last five years surpassed that of Gen X and the boomers.
• Smart money moves like consistent investing and acquiring real estate are key factors contributing to millennials’ wealth.

Millennials’ Financial Progress

When the pandemic hit in March 2020, the markets tumbled, interest rates dropped, inflation soared, and uncertainty ruled. Wealthfront’s recent report has shown that millennials not only weathered this turbulence but also emerged financially stronger.

The report points to data from the Federal Reserve, which reveals that the total net worth of U.S. millennials jumped from $3.94 trillion in Q3 2019 to a staggering $15.95 trillion in Q3 2024, a nearly four-fold increase.

Wealthfront’s millennial clients saw account balances grow by 137%, from $45,600 in early 2020 to $108,130 by early 2025. Notably, the share of millennial “Wealthfront millionaires,” clients with over $1 million in assets, grew by 144% over the past five years. And since these Wealthfront accounts exclude assets like real estate and 401(k)s, their total wealth is likely greater.

Overall, according to that report, millennials’ financial progress has eclipsed that of Gen X and baby boomers, who saw their wealth grow by 76% and 40%, respectively.

Note

Between March 2020 and February 2025, increases in IRA balances for millennials were over 112% versus over 52% for Gen X.

Americans under 40, a group that includes Generation Z, saw their average wealth rise by 49% between 2019 and 2023, according to another 2024 report from the New Center for American Progress. And a report from Empower found that millennial wealth grew 13% in 2024, which is faster than Gen X and boomers.

Key Factors Driving the Millennial Wealth Surge

Building wealth takes careful planning and smart financial decisions. Wealthfront’s data highlights several key factors that fueled millennials’ financial growth over the past five years, showing how they navigated challenges and made strategic choices to accumulate wealth despite the economic climate.

Consistent Investing: Millennials have shown remarkable discipline in their investment habits, making steady contributions despite market fluctuations.

Strategic Retirement Planning: Staying committed to building their retirement savings is another driving factor for millennials to build wealth. Since March 2020, their average individual retirement account (IRA) balances have increased by more than 110%.

Real Estate: Real estate has become a powerful wealth-building tool for millennials. Values of acquired properties increased by more than 40% from 2020 to 2025, boosting their home equity and strengthening their overall financial position.

The Bottom Line

The takeaway is clear: many millennials are financially thriving. Their strong commitment to investing, saving, and diversifying their portfolios has allowed them to weather economic uncertainty and build lasting wealth.

With continued focus on long-term financial strategies, millennials are well-positioned to maintain and grow their financial success in the years to come.

Fact checked by Vikki Velasquez

Is it possible to make $500,000 to support you throughout your retirement? Yes, but it takes some careful planning, adjustments, and smart investing moves.

Key Takeaways

• Make a budget detailing your expenses and your income sources, such as Social Security benefits and/or a pension.
• Use the 4% rule and withdraw no more than 4% of your investment portfolio annually.
• In down markets, withdraw less from your investments.
• If you are experiencing a shortfall in your retirement savings, getting a part-time job can help. You can trim expenses by downsizing your home, sharing a car, or moving to a less expensive place.

Estimate Annual Expenses in Retirement

Start by establishing how much you will be spending each year of your retirement. It’s time to make a budget. So, add together all your expected expenses.

According to Carla Adams, financial advisor and founder of Ametrine Wealth, most people will need to replace approximately 70% of their income after they retire. The percentage isn’t closer to 100% because once you retire, you may be able to stop saving for retirement, and taxes are often lower for retirees. “And many people end up paying off their mortgage around the time they retire, so that expense goes away,” says Adams.

So your annual expenses have changed, but you also need to look at your income sources. Don’t forget to include your Social Security benefits, any annuities, stock dividends you expect, and the pension you may have from a former employer.

“Pensions, if you’re lucky enough to have one, are wonderful, because the more income you have, the less you have to withdraw from your portfolio for retirement. Social Security and pensions are also guaranteed for life, unlike your investment portfolio,” Adams says.

Use the 4% Rule

When withdrawing money from your retirement savings, most advisors would say it is wise to follow the 4% rule. According to this rule, you should be able to withdraw 4% of your retirement savings balance in the first year after you retire. Then adjust for inflation and withdraw the same dollar amount every year thereafter for approximately 30 years.

“This is based on a 65-year-old having a portfolio that is 60% stocks and 40% bonds that gives an annual average return of about 7%,” says Adams. “If you have a $500,000 portfolio, then, per the 4% rule, you can safely withdraw about $20,000 per year.”

However, not everyone agrees that this is the perfect percentage. The creator of the rule, William P. Bengen, thinks 5% could be a better rule for all, while others caution that a 3% rule might be safer. Talk to a financial advisor about your particular situation.

Beware of Sequence of Returns Risk

You may need to take smaller withdrawals during down markets to avoid a sequence of returns risk. This can happen when your portfolio experiences a major loss because of a market downturn early in retirement. It can mean less money in your savings in future years.

“It can shrink your portfolio much faster than expected,” says Daniel Milks, a certified financial planner and founder of Fiduciary Organization. “In down years, reducing withdrawals or tapping cash reserves can help protect against this risk.”

In addition to turning to cash, to mitigate this problem, ensure your portfolio is reviewed regularly and well diversified across different asset classes to reduce the impact of any single asset’s performance. Your financial advisor might also suggest a phased retirement where your transition happens more gradually.

Continue Earning

Having a part-time job is a great way to supplement your income during retirement. Even a few thousand a year can make a difference and allow you to withdraw less from your retirement savings.

“Working part-time in retirement can make a lot of sense for those who are concerned about spending through their portfolio before the end of their lifetime,” Adams says. “Even if you only make, say, $10,000 per year working part-time in retirement, that’s $10,000 less that you have to withdraw from your portfolio to cover your cost of living, and that money can instead stay in your portfolio and continue to grow.”

Other forms of income, such as rental income, can also help to bolster your income during retirement.

“Part-time work, consulting, or rental income can all help stretch savings. They give retirees flexibility and reduce the pressure on their investment accounts, especially in uncertain markets,” Milks says.

How to Balance Risk and Return

The risk-return tradeoff states that as risk rises, so does the potential return. You want your retirement portfolio to balance risk and still give you the return that you need during your retirement years. The further away from retirement you are, the more risky you can afford to be, but as you approach your next transition, you should consider becoming a bit more risk-averse.

“A balanced mix of equities for growth and bonds or cash for stability works well,” Milks says. “I often suggest a ‘bucket strategy’—short-term needs in cash, medium-term in bonds, and long-term growth in stocks.”

How to Handle Shortfalls

If there are shortfalls in your retirement budget, you’ll want to look for ways to cut expenses.

“We normally start with small cuts, such as downgrading a TV package, changing cellphone plans, or refinancing higher-interest debt,” says Chris Diodato, a certified financial planner and founder of WELLth Financial Planning. “Once those options are exhausted, we turn to larger cuts and ask questions about downsizing or living with only one car.”

Bigger shortfalls may call for bigger actions, such as downsizing, relocating to a more cost or tax-friendly location, or turning to home equity by considering a reverse mortgage.

Benefits of a Financial Planner

Choosing the right financial planner can help to steer your retirement plans in the right direction.

“Working with a fiduciary, fee-only financial planner is important because you get advice that’s based solely on your best interests—not on commissions or product sales. It helps you avoid emotional decisions and ensures you’re following a strategy that’s aligned with your goals,” Milks says.

Getting a written financial plan from a financial planner is also a smart move.

“Having a formal, trackable plan makes it much easier to adjust course when markets shift or your life circumstances change,” Milks says.

The Bottom Line

To make $500,000 last in your retirement, you’ll have to make some smart financial moves. Begin by estimating your annual expenses and income, such as money from a part-time job, Social Security benefits, and a pension.

When withdrawing money from an investment portfolio, use the 4% rule and withdraw no more than 4% of your investments in a year. In down markets, reduce the money you withdraw from investments and use your cash reserves instead. Consider part-time work to supplement your income, especially if you are experiencing a shortfall in your retirement savings.

Cutting both small and big expenses can help. For example, you may want to consider downsizing, going down to a single car, or moving to a place with a lower cost of living.