How to Bounce Back at 65 With No Retirement Savings

How to bounce back at 65 with no retirement savings

Find out what you can do when you reach retirement age (65), and have little or no retirement savings.

You're likely to have heard the constant call to start saving for retirement before you turn 65.

In a perfect world, you would be able set aside 10% to 15% of your monthly income for retirement savings.

However, many investors find it difficult to do so.

If you reach age 65 and have little or no retirement savings, you are in good company. According to some reports, as high as 42 percent retire with less than $10,000.

There are some good news.

There are still things you can do, even if you don't have any retirement savings by age 65.

Let's take a look at the options available to you if your retirement savings are not up to par at 65.

1. Work Longer

Americans are healthier than ever before. Although 65 is often considered a retirement age, many Americans work well beyond that age.

Working longer may not be an issue if you have a passion for your business or work for a company you love.

You might even not want to retire at 65.

Live longer

According to the Bureau of Labor Statistics, the life expectancy of a 65-year old is just above 20 years.

This could mean that you are funding your “retirement” for up to 20 years. This can be difficult to achieve if you don't have any savings.

However, statistics show that you will live a longer life.

Even if you work for 10 years more, your life expectancy is still at least 10 years.

You can build a substantial nest egg by working extra 10 years and establishing good savings habits.

This is in addition the many other benefits of working longer such as sharpening your mind and maintaining a social network.

Even if you start at 65 with nothing, you can still save money, get ancillary mental and social benefits, and enjoy a retirement that lasts 10 more years.

2. Maximize Government Benefits

One side benefit to working longer is the possibility of maximizing your Social Security benefits.

Your benefit increases by 8 percent every year you delay taking Social Security.

Your Social Security payouts could increase by 32 percent if you work just a few more years until age 70.

This is equivalent to getting an 8 percent increase in your annual salary for working, plus the money you make from actually working.

This double-dipping can really help you accelerate your retirement savings plan.


Do not overlook other government benefits you may be eligible for at 65, such as Medicare and Social Security Disability Insurance.

The majority of Americans are eligible for Medicare by the age of 65. You should check your eligibility and register as soon possible to receive these benefits.

Health insurance in the United States is expensive for many Americans, with many paying $10,000 annually or more.

These premiums may not be new to you. Medicare could be your best option, as Medicare Part B is completely free for all eligible Americans.

You can also get government-based insurance and use that cash flow to fund your retirement savings.

3. Contribute to Retirement Savings Accounts

Some investors withdraw money from their retirement accounts as early as 59 1/2, which is when you can avoid the 10% penalty for early withdrawals.

Did you know you can continue contributing to IRAs up until the age of 70?

Retirement accounts offer a tax structure that can help increase investment value.

As your investments grow, both traditional IRAs and Roth IRAs will not tax you on an income basis.

This means your investment gains can multiply without you needing to take out money to pay taxes.

You may be eligible for a tax deduction on the amount that you contribute to a traditional IRA. However, your distributions are taxable.

Roth IRA withdrawals are exempt from tax, provided the account has been open for at least five consecutive years.

For 2020 and 2021 most investors can contribute up to $6,000 to an IRA.

You can still make “catch-up” payments if you are over 65. For a total of $7,000, the IRS allows anyone 50 years old or older to make an additional $1,000 contribution to an IRA.

You may still be eligible to contribute to your employer’s 401(k).

Most workers can contribute $19,500 annually to a 401(k), plan for 2020 and 2021. For a total of $26,000, you will be able to benefit from an additional $6500 per year catch up contribution as a 65-year-old.

You won't usually have to pay taxes on the money that you contribute.

It keeps improving when it comes 401k plans.


Roth 401 (k) vs. traditional 401 (k)

Even better, a Roth IRA allows you to continue contributing throughout your entire life.


Many of these plans allow employers to match their contributions.

Employer matches typically cover 50 percent of your contributions, up to a maximum amount such as 5 percent.

Let's say you make $60,000. You earn $60,000. If you contribute $5 percent, you'll get $3,000. Your employer could contribute an additional $1,500 if you contributed 5 percent of your salary.

This is the closest thing you will ever see to free money in your life!

Contributing your savings to a retirement account can maximize your retirement savings' growth.

4. Trim Your Lifestyle

We all know that it is difficult to reduce our lifestyles.

We are a culture of consumers that is trained to want more, better, and bigger.

The truth is, most people can live a simple lifestyle that doesn't cost much.

These are just a few examples.


You are likely to have no children if you are over 65. You may consider moving to a smaller home if you live alone or with your spouse.

If you have a two- or more-bedroom apartment or house, consider a one-bedroom. It is likely that you don't require all the extra space and can save quite a bit on rent.

Cheaper travel

It is possible to make significant savings on your travel and entertainment expenses.

These areas can be a great place to save money without any suffering.

Consider, for example, taking two trips abroad per year. Instead, you might consider two trips within the country.

America is large and beautiful. You might be amazed at the things you can see within a few hours of landing in your own backyard instead of flying around the world.

If you are planning on traveling abroad, combine the two trips.

Frugal fun

Entertainment is often a major part of a household's budget.

You might be able to cook meals at home that taste better than dining out.

Learn how to cook if you don’t know what cooking is. You can save money by cooking at home and still have fun learning new skills.

These simple changes can help you save a lot of money and put it towards your retirement savings.

You can save even more by making drastic lifestyle changes. These lifestyle changes can help you start.

5. Create an Emergency Fund

It is crucial to save for retirement, especially if you are short of money and turn 65.

However, just because you are 65 does not mean life's little surprises won't surprise you.

Unexpected expenses that cause a halt to your savings plan are not what you want when you're trying for retirement.

Most financial advisors recommend that you have an emergency fund even if you want to maximize your retirement.


Health and Medical Protections

It might seem as though you are putting too much pressure on your resources by building an emergency fund and maxing your retirement savings.

It's true, saving for retirement at 65 is more difficult than if you started when you were 20.

Why should you worry about another savings account, this one for medical and health protections?

Retirement savings are designed to help you maximize your financial situation in the later years of your life.

You must reduce the chance of your financial ruin.

Long-term care is needed

According to the U.S. Department of Health and Human Services, there is a 70% chance that someone 65 years old will need long-term care.

This is a high percentage.

If you are ever in need of assistance, purchasing long-term insurance could pay off.

A policy like this can at least give you some peace of mind.
If you are still employed, employer-provided insurance might be of benefit to your general health. Medicare may be an option for you if this is not the case. Register as soon as possible to be eligible.

Also, consider insurance for the disabled.

Good news is that your employer may offer you low-cost or disability insurance if you are still working.

You might also be covered by Social Security disability insurance. Check your status with Social Security Administration.

This can help you avoid medical bills that could wipe out your retirement savings.


You're likely to live at least another 20-years after you turn 65. You have plenty of time to start a savings program, even late in your life, so you can enjoy retirement in the future.

Prioritize tax deferral and employer match for a 401(k), or fund your own IRA.

Do not overlook an emergency fund or as many coverages as possible, including long-term care and disability.

Prioritize your savings over your current expenses to fund your retirement savings.

Reduce your lifestyle wherever possible.

You can always cut more if you aren't reaching your savings goals.

If you are starting at 65, it may not be easy for you to build a substantial retirement nest egg. But you might be surprised at the financial gains you can make by making a few small changes.

This is our disclosure:  This summary is for informational purposes only. This summary is not intended to be a recommendation for or give advice for any company or individual.

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