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What do you do when your 60th birthday is approaching and you haven’t saved much, if anything, for retirement?
Imagine that Ryan, a single man from Little Rock, Arkansas, found himself in this situation shortly after losing his job during a corporate restructuring. He’s considering not receiving Social Security benefits for another two years, with reduced benefits, and wonders how he’s going to make ends meet for the next 20 years or more.
According to a 2024 AARP survey, one in five Americans over age 50 has no retirement savings, and 61% worry they won’t have enough money to support themselves in their later years(1). The average Social Security benefit for retired workers is $2,006.69 per month, according to the Social Security Administration, but that figure includes high earners and those who wait until full retirement age (67 if born in 1960 or later) to collect benefits. If you are forced to claim benefits early, your monthly check may be much smaller(2).
The good news is that people in this situation still have a viable path to financial security, as long as they take the right actions.
The key is to maximize revenue, take advantage of all available benefits, and cut fixed costs until the math works. The process isn’t easy, but with discipline and determination, you can eliminate anxiety.
Doomscrolling personal finance websites can give you the wrong impression that your situation is dire. For example, according to a study by Northwestern Mutual, Americans say they need a “magic number” of approximately $1.26 million to retire comfortably(3).
But how accurate is this number? Lump sums like this are often back-projected based on rules developed in 1994 by financial planner William Bengen, who analyzed historical market data and found that an interest rate of 4% per year from a balanced portfolio is generally safe enough to cover a 30-year retirement. But if you can spend less, you can spend less (4).
Assuming you are healthy and able to work, it is important to delay collecting Social Security benefits for as long as possible. Deferring Social Security until full retirement age, possibly even until age 70, increases your guaranteed monthly checks for life because you earn delayed retirement credits, which increase by about 8% each year after full retirement age. For those born in 1960 or later, filing a claim at age 70 will pay approximately 124% of your full benefit (5).
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One way to live more comfortably while delaying Social Security is to build emergency savings so you don’t have to dip into your retirement accounts early. High-yield accounts, such as the Wealthfront Cash Account, can be a great place to grow your emergency fund, offering competitive interest rates and easy access to cash when you need it.
The Wealthfront Cash Account offers a base variable APR of 3.50%, but new customers can get a 0.65% boost for the first three months, for a total APR of 4.15% offered by the bank on your uninvested cash. That’s more than ten times the national deposit savings rate, according to the FDIC’s November report.
With no minimum balance or account fees, along with 24/7 withdrawals and free domestic wire transfers, you can be sure your funds are always available. In addition, the FDIC insures Wealthfront cash account balances up to $8 million through program banks.
Another way to buy time to apply for Social Security later is to find a job so you can continue to earn a steady income.
American Career Centers can connect you with job openings, provide short training courses, and provide you with local recruitment assistance(6). Contract and gig work, such as freelancing or using delivery apps, may help you, but don’t forget to set aside money for self-employment and income tax.
If your current or future job doesn’t offer a 401(k), you can also open your own tax-advantaged account and make automatic contributions to keep your savings growing. If you are under age 50, you can contribute up to $7,000 to an IRA for tax year 2025, and if you are age 50 or older, you may be eligible for an additional $1,000 in catch-up funds, bringing the total to $8,000(7).
If you earn self-employment income, you have other retirement plan options. If you have self-employment income, consider a SEP IRA or a solo “solo” 401(k).
A SEP allows you, as your own employer, to contribute up to 25% of your net self-employment income, up to a maximum of $70,000 in 2025(8). A standalone 401(k), on the other hand, allows both employee (up to $23,500 in 2025) and employer (up to 25% of salary) contributions, with the same overall limit of $70,000(9).
Through his long-term bank, Ryan was able to consult with a personal financial advisor for free, and he received some basic advice. He was told that the first step in cutting costs should be to create a zero-based budget for the next 60 days and track every expense to confirm your true baseline budget (10).
If managing a budget feels overwhelming to you, apps like Rocket Money can simplify the process.
Rocket Money tracks and categorizes your spending, providing a clear view of your cash, credit, and investments in one place. It can even uncover forgotten subscriptions, helping you cut unnecessary costs and potentially save hundreds of dollars each year.
For a small fee, the app can also negotiate a lower rate on your monthly bill, making it a valuable tool for keeping your finances on track.
You may also want to review your monthly charges to make sure you’re paying all necessary fees at the best price.
For example, according to AAA, the total cost of owning and operating a new car will climb to about $12,297 per year, or $1,024.71 per month, by 2025.
By using OfficialCarInsurance.com, you can easily compare quotes from multiple insurance companies, such as Progressive, Allstate, and GEICO, to ensure you’re getting the best deal.
It only takes two minutes and you can find rates as low as $29 per month.
Then there are housing costs. While these are often a burden, there are ways to alleviate them. Is your current space larger than you need? Consider downsizing, whether that means moving to a smaller place if you rent, moving in with roommates (old people do it all the time!), or, if you own your home, making extra income by renting out rooms.
Given your financial predicament, you could benefit from exploring all possible options. When it comes to food or income assistance (such as SNAP or LIHEAP), Medicaid, or disability, you should apply if you qualify.
You might want to consider joining an organization like AARP to get discounts on almost everything—from prescription drugs and dental plans to travel, entertainment, and insurance.
As one of the most trusted organizations for seniors in America, AARP not only offers money-saving benefits but also helps you make smart financial and health decisions.
AARP members have access to guides to help you get the most out of Social Security, choose the right Medicare plan, and learn about other government benefits—potentially saving you thousands of dollars.
Join AARP today and get 25% off your first year.
You can also obtain housing vouchers through your local public housing agency. The coupon formula targets tenants to spend approximately 30% of their adjusted income on rent and utilities (11). If your income meets the requirements, the Senior Community Service Employment Program provides paid, part-time community placement as well as skills training that leads to long-term employment (12).
Turning 60 and having no savings can be daunting. Many Americans dream of seven figures in savings. But remember, with dedication and hard work, many people retire with much less.
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AARP (1); Social Security Administration (2); Northwestern Mutual (3); Prudential (4); Social Security Administration (5); American Job Centers (6); Internal Revenue Service (7), (8), (9); Citizens Bank (10) U.S. Department of Housing and Urban Development (11); Senior Community Services Employment Program (12)
This article provides information only and should not be considered advice. It is provided without any warranty of any kind.
