It’s not too late to start saving for retirement, even if you’re already in your 50s. Make the most of the time you have left in the workforce by reducing your spending, maximizing how much you save, and consulting with financial advisor experts to help set up a strategy for your retirement account.
You may also want to consider working a few extra years to boost your retirement security savings.
Below we’ll explore practical ways to plan for your golden years without having a long track record of retirement saving.
Can You Retire at 65 With No Savings?
It’s not advised and won’t be easy, but under the banner of “you can do anything you set your mind to,” we’ll say that yes—you can leave your full-time career with no retirement savings at 65.
In order to pull it off, though, you’ll likely need to:
- Significantly downsize your lifestyle, from housing to monthly expenses
- Maximize all governmental aid in addition to Social Security benefits
- Rely on family and friends for some types of assistance
At this stage of life, your primary source of income will likely be from the Social Security Administration, and the amount you receive depends on your work history (and on the preservation of the Social Security trust funds). In June 2022, the average Social Security check for a retired worker was $1,669.1
To estimate your future retirement benefits, you can refer to the last Social Security statement you received or set up a free my Social Security account online.2
Your Options with No Retirement Savings at 50 to 65
If you’ve spent a lot of energy reprimanding yourself for a lost opportunity, take a deep breath and let it go. Whatever circumstances led you to where you are today, there are practical steps you can take to plan for a dignified, secure, and even exciting stretch of retirement years.
So, let’s see what there is in store.
#1 Set Realistic Goals
A frugal retirement doesn’t mean “misery ahead,” but it does mean you won’t be lounging on private golf resorts or exclusive beaches. Consider what a high quality of life means for you, and what resources are available in your area. You could:
- Focus on nature and explore your park systems
- Read the great books, join discussion clubs, and tutor or teach at your library
- Invest your time in creative pursuits with low overhead (e.g. writing)
#2 Start Now
If you’ve hit 50 without a retirement plan in place, it’s not too late to start—anything you can save now will help. By trimming the fat on your spending, you can still maximize your personal savings with whatever you can afford to invest. Follow the basic tips for saving for retirement:
- Set up automatic contributions to your employer and independent accounts
- Contribute the maximum to your 401k or other employer plan
- Create a Roth or traditional IRA and contribute the maximum amount
- Create a SEP IRA if self-employed, even as a side gig, for larger tax-free contributions
- Move savings to higher-yield money market funds and CDs rather than basic savings
#3 Ask for Help
Remember, you’re not the first person among older Americans to ever be in this sort of financial situation. To find free or discounted financial planning services, reach out to your:
- Bank or credit union
- Employer’s human resources or benefits department
- Library and local government for free classes and consultations
These services can guide you in making the best possible choices given your financial profile and the resources available to you.
#4 Spend Less and Budget Your Money
When money is tight, it’s more important than ever to prevent loss through unplanned spending. You can streamline your living expenses by:
- Setting and following a monthly budget
- Researching senior or low-income programs for discounts on utilities and monthly bills
- Using senior discount days and offers on groceries, memberships, and restaurant costs
- Shop for Medicare plan perks such as free gym memberships
- Negotiate for insurance discounts based on claim history, age, and low vehicle usage
#5 Sell Your Assets
Nearing retirement age, most homeowners have a property full of things they don’t need (or have altogether forgotten about, or tucked away in attics and basement storage). Take a fresh look at your belongings as possible inventory for your very own storefront sale. What are you hanging onto out of habit or sentiment that could be better appreciated or used by someone new?
Keep an eye out for:
- Clothing and jewelry that have aged into vintage or antique status
- Tools and materials for hobbies you no longer pursue
- Kitchen and household goods you no longer use
- Classic, art, and niche books with resale value
Downsizing your living conditions inevitably comes with a culling process that may include selling or donating items just to get rid of them. But before you get to this point, consider what can be sold more profitably through:
- Auction businesses
- Consignment stores
- Online reselling such as eBay and Facebook Marketplace
#6 Expand Your Income
How can you earn more personal capital after retiring from a full-time career? There are many ways to leverage the knowledge and skills you’ve acquired without returning to the workforce.
Some options include:
- Serving as an occasional consultant in your field of expertise
- Creating a passive income stream via instructional ebooks and online courses
- Teaching a continuing or community education course
- Getting a part-time job that comes with a valuable employee discount
Also note that, once you reach full retirement age (67 if you’re born after 1960), you can earn any amount of money without reducing your Social Security benefits.3
#7 Convert Your Home Equity
If you’re a homeowner with little retirement savings at 55, 60, or even 65, you can turn your equity into cash to help you temporarily support yourself while you work towards a source of retirement funds. You’ve been growing your equity by making mortgage payments over the years while property values have risen, and if you qualify, you can convert that equity to cash that you can use to help you reach your financial goals to invest in retirement plans or trusts. Using home equity for retirement savings can be a surefire way to gain personal capital.
#8 Lower Your Cost of Living
You’ve reduced your expectations and tightened your belt—how else can you live closer to the bone? One way is to move to a city and state with a lower cost of living. It’s easy to compare costs of living in general, but also consider senior-specific costs:
- Does the state tax Social Security income benefits?
- Are IRAs and pensions taxed?
- What is the unemployment rate (if you plan to work part-time)?
- How will the state and local sales tax and property tax rates affect you?
- What is the median house or rent cost?
Here are some states to consider that currently help seniors stretch their dollar (and it’s entirely chance that the top three start with “A”):
- Alabama – This state doesn’t tax Social Security or pension funds, and homeowners over 65 don’t have to pay state property taxes.4
- Arkansas – No tax on Social Security benefits and some of the lowest property taxes and housing costs in the country, plus the cost of living is 7.5% under the national average.
- Arizona – In addition to exceptional weather, the Arizona cost of living for seniors is nearly 4% below the U.S. average. Prescott is one of the cheapest cities for senior living.
Other cheap states for seniors include Colorado, Florida, Georgia, and Ohio. Generally, low-cost living for seniors is primarily found in southern states and some of the midwest.
#9 Downsize Your Home
Downsizing is common for retirees, since you’ll need less space than you did in child-rearing years. Downsizing supports your budget by:
- Lowering your monthly housing expenses to a smaller mortgage or rent payment
- Reducing utilities to heat and cool less space
- Cutting the cost of upkeep and maintenance on a larger property
Feel free to learn more about the unexpected benefits of downsizing your home if this sounds like a good choice for you.
#10 Move Abroad
Wait—can foreign travel be a part of your retirement, even if you’re on a tight budget? Yes!
If you do your research and choose carefully, you can find destinations where it’s easy to live on no more than $12,000 per year.
That said, there are some risks and up-front costs, including:
- Travel and visas
- Securing and outfitting a new home
- Covering health and daily needs while being less familiar with available resources
If you’re ready to tackle those challenges, U.S. News recommends these destinations for living well on $1,000 or less per month:5
- Northern Cyprus
- Corozal, Belize
- Chiang Rai, Thailand
- Granada, Nicaragua
- Nha Trang, Vietnam
Don’t waste energy berating yourself for not socking away a nest egg years ago—instead, focus on what you can do to plan for your retirement years now.
There are many ways to convert your current resources and assets to save up for your golden years and live well within your means.
- Social Security Administration. Social Security Basic Facts. https://www.ssa.gov/news/press/factsheets/basicfact-alt.pdf
- Social Security Administration. Create your personal my Social Security account today. https://www.ssa.gov/myaccount/
- Social Security Administration. Retirement Age Calculator. https://www.ssa.gov/benefits/retirement/planner/ageincrease.html
- SeniorLiving.org. Best Places to Retire for Seniors. https://www.seniorliving.org/retirement/best-places/
- U.S. News. The Cheapest Places to Retire Abroad on $1,000 Per Month. https://money.usnews.com/money/retirement/baby-boomers/slideshows/the-cheapest-places-to-retire-abroad-on-1-000-per-month?slide=13