60 Years Old and No Retirement Savings

How To Streamline Your Budget When You’re Retirement Age and Have No Savings: Downsize your home Sell your car and use ride-sharing services instead Increase the deductible on your homeowners’ insurance policy Take advantage of senior discounts Pick generic over name-brand
The Balance / Emily Mendoza . Photo:

The Balance / Emily Mendoza

You may be entering your 60s and beginning to consider retirement and begin to realize you don't have a large savings or investment account to help pay for these years. Fortunately, a sound financial plan can remedy this situation.

Proper planning is essential to creating financial retirement security. But according to a September 2019 "GoBankingRates.com" survey, 64% of Americans risk reaching retirement age with less than $10,000 saved. The same survey found that nearly half of Americans polled had no money set aside for their later years right now. 

Take Stock of Your Retirement Assets

Creating a retirement plan requires first carefully evaluating your existing assets, including cash savings, employer pension funds, annuities, and retirement accounts like 401(k)s or individual retirement accounts. It's also important to assess your physical assets, such as homes, cars, antiques, collectibles, land, and anything else you may sell to generate retirement income.

Reduce Spending and Streamline Your Budget

If you are nearing retirement age, with scant savings, a detailed budget may help you stay above water. But it's important to devise a financial plan, with as much lead time as possible. In addition to selling physical possessions and downsizing your home, the following cost-cutting measures can help you create a rosier retirement outlook:

  • Sell your car and use ride-sharing services, to eliminate car payments and insurance bills.
  • Discontinue your landline telephone and acquire the cheapest possible cell phone plan.
  • Raise the deductible on your homeowners' insurance policy to lower premium costs.
  • Take advantage of senior discounts.
  • Sign up for Medicare as soon as you're eligible to reduce out-of-pocket health care costs.
  • Choose generic products over name-brand merchandise.
  • Make inexpensive home improvements that increase energy efficiency and reduce utility bills. For example, purchase a programmable thermostat or replace attic insulation.

You may also qualify for various state and federal aid programs. Military retirees and dependents may also qualify for additional programs. Most utility services will work with seniors to provide a reduction in bills or help with weatherization. There may also be programs to assist you with food and nutrition. Check with your local Council on Aging, who may have a list of programs and can help you contact these administrators.

Paying Down Debt

If you're headed into retirement with debt, be strategic about paying it off when you have some extra bucks. But while it may be tempting to funnel all extra money towards relieving debt, it's equally important to maintain a financial cushion for emergencies. For this reason, the best option may be splitting your money between retirement savings and debt payoff. 

If you have financially assisted adult children or grandchildren in the past, consider curbing this generous impulse. Communication will go a long way in helping your loved ones understand your shift towards prioritizing your financial future.

Focus on Building Income Streams

If you're retiring without substantial savings, Social Security will probably be your primary source of retirement income. You may receive benefits as early as age 62. However, this triggers a reduction in your benefit amount.

If you elect to take benefits early, consider earning supplemental income by working part-time. Just be aware that working while claiming Social Security may result in your benefits being temporarily reduced if your earnings exceed the allowed threshold.

If you've built up substantial equity in your home, you can create income through a home equity loan or a line of credit (HELOC). However, these are still loans and must be repaid by you at a later time.

Alternatively, you can obtain a reverse mortgage, which generally doesn't require you to make payments, unless you're no longer living in the home. When you pass away, your heirs would be responsible for either repaying the reverse mortgage outright if they wish to keep the home or selling it and using the proceeds to repay the reverse mortgage balance.

Consider renting out a room or part of your home on Airbnb. Just remember to check your local zoning laws to make sure this is permitted. Also, don't forget to consider the tax implications of claiming Airbnb rental income.

Frequently Asked Questions (FAQs)

How common is it to be 60-years-old without retirement savings?

According to the Federal Reserve, roughly 13% of Americans age 60 or older didn't have any level of retirement savings in 2020. Just 48% of those age 60 or older said they felt that their retirement savings were "on track."

If you don't have an employer-sponsored retirement plan, where else can you invest tax-free retirement savings?

Individual retirement accounts (IRAs) are available to anyone who has some level of annual income. IRAs primarily come in two types: traditional (pre-tax) and Roth (post-tax). Anyone can choose between the two depending on whether they want tax savings now (traditional) or in retirement (Roth). You can contribute up to $6,000 in 2022 ($7,000 for those age 50 or older), or you can contribute 100% of your taxable income, whichever is less.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. GoBankingRates. "64% of Americans Aren’t Prepared for Retirement — and 48% Don’t Care."

  2. Social Security Administration. "Retirement Age."

  3. Social Security Administration. "Important Things to Consider When Planning for Retirement."

  4. Federal Trade Commission Consumer Information. "Reverse Mortgages."

  5. Board of Governors of the Federal Reserve System. "Report on the Economic Well-Being of U.S. Households in 2020 - May 2021: Retirement."

  6. Internal Revenue Service. "IRA Contribution Limits."

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