Updated: Sep 06, 2023

How to Bounce Back at Age 65 With No Retirement Savings

Learn what you can do if you're at or near retirement age (65) with little to no significant retirement savings -- see the steps to take now.
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By the time you reach age 65, you’ve no doubt heard the incessant call that you should save for retirement as early as possible.

And in a perfect world, it would be great to be able to set aside 10 or 15 percent of your income every month of your life for retirement savings.

But the reality is that it’s hard for many investors to do that.

In fact, if you’ve reached age 65 with little-to-no retirement savings, you’re in good company. Some reports claim that as many as 42 percent of Americans retire with $10,000 or less.

But there’s some good news.

Even if you have no retirement savings at age 65, there are things you can do to change that.

Here’s a look at some of the options you have if you’re falling short on your retirement savings at age 65.

1. Work Longer

Americans are as healthy as they have ever been. While 65 is commonly seen as a “traditional” retirement age, many Americans continue to work far past that age.

If you run your own business that’s your life passion or work for an employer that you enjoy, working longer might not be a struggle at all.

In fact, you might not want to even consider retiring at age 65.

Live longer

Life expectancy for a 65-year-old is just over 20 years, according to the Bureau of Labor Statistics.

This means you may be funding a “retirement” for 20 years or more. With no savings, this can be hard to pull off.

But, the other side of this coin is that, statistically speaking, you’ll have a much longer life than you might imagine.

Even if you work 10 more years, your life expectancy will be at least another 10 years.

By working 10 extra years, diligent saving habits can help you build up a fairly significant nest egg.

This is in addition to all the other ancillary benefits of working longer, such as keeping your mind sharp and maintaining a social circle.

The point is that even starting with zero at age 65, you can manage to tuck away some savings, enjoy ancillary social and mental benefits, and still enjoy a retirement that could last an additional 10 years or more.

2. Maximize Government Benefits

An overlooked side benefit of working longer is that you can maximize your Social Security payout.

Every year that you defer taking Social Security, your benefit rises by 8 percent.

If you work just a few extra years, until age 70, your Social Security payout could rise by as much as 32 percent.

That’s like getting an 8 percent raise every year you work, on top of the money you earn from actually working!

This is the kind of double-dipping that can really accelerate your retirement savings program.


Don’t overlook additional government benefits that you might be entitled to at age 65, including Social Security disability insurance and Medicare.

Most Americans become eligible for Medicare at age 65, so you’ll want to check your status and register as soon as possible to enjoy those benefits.

Many younger Americans pay $10,000 or more annually for health insurance in the U.S.

You may be accustomed to those kinds of premiums. If so, Medicare can prove to be a huge windfall, since Medicare Part A is free for most qualifying Americans.

In addition to getting government-based insurance, you’ll free up that cash flow and can put it directly towards your retirement savings.

3. Contribute to Retirement Accounts

Some investors start taking money out of their retirement accounts at age 59 ½, which is the earliest you can avoid the 10 percent early withdrawal penalty.

But, did you know that you can keep contributing to IRAs until age 70?

Better yet, if you have a Roth IRA, you can keep contributing for the rest of your life.

Traditional IRA Vs. Roth IRA

Traditional IRA Roth IRA
Contributions may be tax-deductible. Contributions are not tax-deductible.
Pay taxes upon withdrawal. Earnings can be withdrawn tax-free and without penalties if the funds were in the Roth IRA for 5 years and you've reached age 59 1/2.
You must be under age 70 1/2 to contribute. You can contribute at any age.
Required minimum distributions (RMDs) are required starting at age 70 1/2. No RMDs required.

Retirement accounts provide a beneficial tax structure that helps boost investment values.

For both traditional and Roth IRAs, you won’t pay any income tax on a yearly basis as your investments grow.

This means that your investment gains can compound without you having to take money out to pay tax on those gains.

With a traditional IRA, you may even qualify for a tax deduction on the amount you contribute, although your distributions are taxable.

With a Roth IRA, your withdrawals are tax-free, as long as you’ve had the account open for at least five years.

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

However, if you’re age 65, you can take advantage of “catch-up” contributions. The IRS allows those aged 50 or older to contribute an additional $1,000 to an IRA, for a $7,000 total limit.

If you’re still working, you may be able to contribute to your employer’s 401(k) plan.

For 2020 and 2021 most workers can contribute up to $19,500 per year into a 401(k) plan. As a 65-year old, you can benefit from an additional $6,500 per year catch-up contribution, for a total of $26,000.

Additionally, you won’t typically pay tax on the money you contribute.

But it keeps getting better when it comes to 401(k) plans.

Traditional 401(k) vs. Roth 401(k)

Traditional 401(k) Roth IRA 401(k)
Contributions are tax-deductible. Contributions are not tax-deductible.
Pay taxes upon withdrawal. Earnings can be withdrawn tax-free and without penalties if the funds were in the Roth 401(k) for 5 years and you've reached age 59 1/2.
Required minimum distributions (RMDs) are required starting at age 70 1/2. Required minimum distributions (RMDs) are required starting at age 70 1/2.

Most of these plans allow for matching employer contributions.

Typical employer matches are 50 percent of your contributions up to a certain amount, such as 5 percent.

Say you earn $60,000. If you contribute 5 percent of your salary, you’ll put in $3,000. With a 50 percent match, your employer would contribute another $1,500.

That’s the closest thing to free money you’re likely to see in your lifetime!

By contributing your savings to a retirement plan, you can help maximize the growth of your retirement savings.

4. Trim Your Lifestyle

Let’s face it, no one wants to trim down their lifestyle.

As a consumer culture, we’re trained to always want more, bigger and better.

But the truth is that most people can make simple lifestyle cuts that don’t hurt much.

Here are some easy examples.


If you’re age 65, it’s likely that you don’t have any kids in your household. If you’re living alone, or if it’s just your and your spouse, consider moving to a smaller residence.

For example, if you live in a two- or three-bedroom house or apartment, find a nice one-bedroom instead. You likely don’t need all that extra space, and you can probably save a bundle on your rent.

Cheaper travel

You can also likely find big savings in your travel and entertainment budget.

Many people can find big savings in these areas without suffering at all.

For example, if you normally take two overseas trips per year, consider taking two domestic trips instead.

America is a big, beautiful country, and you might be surprised at what you can find within a drive or a short flight of your home instead of spending a lot of money flying across the globe.

Or, if you’re intent on going abroad, consolidate those two trips into one.

Frugal fun

On the entertainment side, eating out is often a huge part of a household budget.

If you’re a good cook, you might find that you can make meals at home that are even more delicious than eating out, and much more inexpensive.

And if you don’t know how to cook, teach yourself. That can kill two birds with one stone, as you’ll enjoy the savings from eating at home while entertaining yourself by learning a new skill.

Simple changes like these are easy ways to save you boatloads of money that you can put towards your retirement savings, and they aren’t even that much of a sacrifice.

If you need to save even more, you can consider more draconian cuts to your lifestyle. But these easy lifestyle shifts can help you get started.

5. Build an Emergency Fund

Saving for retirement is important, especially if you’re running short and turning 65.

But just because you’re 65 doesn’t mean that life’s little surprises don’t pop up.

The last thing you need as you’re trying to establish your retirement future is for unexpected expenses to derail your savings program.

Even when you’re trying to maximize your retirement, most financial advisers recommend that you start with an emergency fund.

Ideal Size of an Emergency Fund

To start... Ideal goal... Super safe...
$1,000 3-6 months of essential expenses 12 months of expenses

You should shoot for three to six months of savings, which you can keep in a high-yield online savings account.

But, tucking away even $1,000 is often enough to cover most short-term emergencies, like a car repair.

The unfortunate truth is that emergencies are a fact of life.

Having liquid reserves to pay for unexpected events can help keep your retirement savings plan on track.

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Health and Medical Protections

You might feel as though maxing out your savings for retirement and still building an emergency fund are enough of a strain on your resources.

And, it’s true that saving at age 65 is a harder road than if you had started at age 20.

So, why do you have to worry about yet another savings bucket, this time for health and medical protections?

The whole point of retirement savings, in general, is to maximize your financial position in the latter years of your life.

To do this, you’ve got to minimize the risk of catastrophic expenses wiping you out.

Need for long-term care

The U.S. Department of Health and Human Services says that someone turning 65 has a nearly 70 percent chance of needing long-term care at some point.

That’s a very high percentage.

Purchasing a long-term care insurance might pay dividends if you ever need assistance.

At the very least, having such a policy can help give you peace of mind.
On the general health front, you might benefit from employer-provided health insurance if you’re still working. If not, Medicare might be the answer for you, so be sure to register when eligible.

You might also consider disability insurance.

The good news here is that if you’re still working, your employer may provide disability insurance for you, or offer a low-cost option.

You may also be already covered by Social Security disability insurance, so check your status with the Social Security Administration.

Covering your bases like this can help protect you from medical expenses that could otherwise wipe out your retirement savings.


At age 65, you’re likely to live for at least another 20 years. This gives you time, even late in life, to begin an aggressive savings program so that you can still enjoy retiring in the future.

Prioritize the tax deferral and employer match of a 401(k) plan, or fund an IRA on your own.

Don’t overlook an emergency fund and as many health coverages as you can afford, from long-term care to disability.

To fund these retirement savings expenses, prioritize your savings over your current needs.

Trim your lifestyle where you can.

If you’re still not reaching your savings goals, cut some more.

It may not be easy to amass a large retirement nest egg if you’re starting at age 65, but you may be surprised at how much you can improve your financial position with just a few simple changes.