If you’re 65, living in your late mother’s house, and planning to retire at 70 with little savings, there are still ways forward.
Planning for retirement may feel daunting, especially when your savings are low, but don’t lose hope. If you’re 65 years old, making $40,000 per year, and expecting $1,890 monthly from Social Security by age 70, there are steps you can take to secure a comfortable retirement, even without a pension.
While Social Security might seem like a solid foundation, living solely on this benefit is often difficult. At 70, you’ll receive about $1,890 monthly. However, without much savings and no pension, a few strategies can make this amount go further.
Joe Favorito, a certified financial planner, emphasizes that financial planning is about managing income and assets. He suggests selling or downsizing assets you no longer need, like your late mother’s house, to pay off debts and ease your monthly budget.
Evaluate your income, expenses, and home assets for a clearer retirement path
To get a clearer picture of your retirement plan, it’s crucial to assess your finances. Herbert Kyles, wealth adviser at Farther, recommends creating a detailed budget to help you understand your essential and discretionary expenses. Consider the possibility of renting out your mother’s house, or selling it to split the proceeds with your sister, which might help pay off your $117,000 home equity line of credit.
Additionally, take advantage of your Social Security benefits by getting a record from SSA.gov and reviewing the best strategies for claiming. A financial adviser can guide you in this area.
Should you hire a financial adviser, and when is it worth the investment? Alonso Rodriguez Segarra, a certified financial planner, explains that postponing your Social Security checks until 70 is a smart choice since your monthly benefit will increase. Even saving small amounts in tax-deferred accounts, like a Roth IRA, can grow your wealth over time. But a financial adviser can also help guide your decisions about owning or selling your apartment, and whether to use the proceeds for retirement savings.
Hiring a financial planner can help you navigate tough decisions—like paying off your HELOC or making adjustments to your lifestyle to maximize your retirement income.
Types of financial planners to consider for retirement guidance
It can be hard to decide which financial planner is best for you. Consider working with a flat-fee planner, who can provide comprehensive advice without the pressure to sell you investment products. Many professionals offer pro bono services or charge a reasonable hourly rate, usually between $150 and $200, which might make their services more affordable.
| Financial planner type | Average cost | Benefits |
|---|---|---|
| Flat-fee financial planner | Fixed rate | No product sales pressure |
| Hourly financial planner | $150–$200 | Affordable and flexible advice |
| Robo-advisers (online tool) | Low fees | Easy, automated portfolio management |
Finding a planner who acts as a fiduciary is key—they’re legally required to act in your best interest, ensuring that your needs come first.
The thought of retiring without a pension or large savings can be overwhelming, but taking proactive steps now can make a significant difference. Begin by carefully evaluating your expenses, assets, and Social Security strategies. Seeking professional advice will provide you with the clarity needed to maximize your retirement benefits and live comfortably in your later years.