Financial instability ranks fifth on the list of Americans' biggest fears about getting older, topped only by concerns about serious health issues, according to a survey of 1,000 adults conducted by Bay Alarm Medical. Concerns about financial instability were so serious, they actually beat out worries about both death of a spouse and one's own death.

If you're worried about money, you're right to be concerned. Pre-retirees have 401(k) balances that are far too low, living on Social Security benefits alone is all but impossible, and few employees today have employer-provided pensions offering guaranteed income.

The good news is: There are ways to make your retirement savings last longer, so you can make it through your senior years without going broke. Here are six tips that can help you stretch your money further.

Jar full of coins with plant growing in it

Image source: Getty Images.

1. Delay claiming Social Security

If you're going to rely on Social Security to provide a substantial amount of your retirement income, you may want to delay claiming it as long as possible.

If you claim benefits before Full Retirement Age (FRA) -- which is 67 if you were born after 1960 -- your benefits will be reduced. The reduction is equal to 5/9 of 1% for each of the first 36 months before FRA, and an additional 5/12 of 1% per month if you retire more than 36 months early. If you wait to claim benefits, on the other hand, you'll not only avoid those reductions but also potentially earn delayed retirement credits through age 70.

This chart shows how claiming at different ages could affect the average Social Security benefit -- which is $1,404 in 2018 -- along with the number of years you'd need to live to make up for delaying your benefits claim.


Change in Benefits Compared to FRA

Monthly Benefits

Annual Difference in Benefits vs. FRA

Benefits Missed by Delaying After 62

Years to Break Even vs. Claiming at 62

Age You'll Break Even


30% reduction







25% reduction







20% reduction







13.3% reduction







6.7% reduction







No change







8% increase







16% increase







24% increase






Data source: Social Security Administration. Calculations by author.

As you can see, you add a lot of money to your monthly Social Security income by waiting as long as you can afford to.

Waiting doesn't always make sense -- if, say, you need to claim early because your spouse is going to claim benefits on your work history. But delaying is often a smart move, if you think you'll live long enough to break even, and you want to maximize the income the Social Security Administration provides.

2. Consider working part-time -- after reaching full retirement age

One of the best ways to make your savings last as long as possible is to rely on them less. If you earn an income from working during retirement, you can leave much of your money invested -- although you'll need to take required minimum distributions from pre-tax retirement accounts to avoid a tax penalty.

There are a few caveats to consider about working during retirement. If you've claimed Social Security benefits before full retirement age and you work during the course of the year, your Social Security benefits could be reduced. And, no matter how old you are, if you work and earn too much money, you could end up pushing your income to the level where your Social Security benefits become taxable.

While you need to pay attention to the impact working during retirement will have on your Social Security, there are plenty of benefits to continuing to hold a job. Not only does it mean you can leave more of your savings invested and growing, but your job can also keep you connected with your community and keep your mind active.

3. Move to an area with a lower cost of living

In 13 U.S. states, a $1 million retirement nest egg will last less than 20 years, according to a GOBankingRates survey. If you plan to live in one of these high-cost states and don't want to run out of money in your 80s, you'd better have the savings to afford it.

If you don't have at least a seven-figure nest egg and you're worried about your savings lasting, it's best to move as soon as possible, before you withdraw too much from savings.

The $1 million that would last you only 12 years in Hawaii or 16.5 years in California would last 26 years in Mississippi or 25 years in Michigan or Oklahoma -- but the longer you wait to find your new home, the more of your money will already be gone.

4. Set up a budget and stick to it

Just 35% of people live on a strict budget, according to Willis Towers Watson's 2017 Global Benefits Attitudes Survey. The survey also revealed that failure to budget or to actively monitor spending is closely correlated with debt and financial instability.

Unfortunately, many seniors don't make a careful budget, just assuming that spending will decline during their golden years. The reality is, almost half of all of seniors spend more during their retirement than they were spending before they left the workforce.

If you're worried about your money running out, don't let your spendthrift ways jeopardize your long-term security. Determine how much you can afford to spend, set a budget that keeps you within these limits, and stick to it.

If you're having a hard time controlling spending, consider switching to an envelope system where you rely on cash you put into envelopes for each category of spending.

5. Don't rely on the 4% rule

Financial experts have long advised seniors they won't run out of money if they keep withdrawals from their investment accounts to 4% per year. Unfortunately, this is based on older advice that may no longer apply.

Seniors are living longer than ever, at the same time that returns are expected to be below historical average -- so the conditions that gave rise to the 4% rule don't apply to the seniors of today and tomorrow. In fact, a 2013 study [opens PDF] found that with current interest rates, there was a 57% chance of money running out during retirement when following the 4% rule.

Instead of using this outdated rule to calculate how much you can spend, consider using the life-expectancy rules for required minimum distributions from the Internal Revenue Service to determine how much to withdraw. Or, if you like the simplicity of the 4% solution, use a modified approach -- just lower your expected withdrawals to around 2.5% to 3%, so you don't have to worry about your money running out too fast.

6. Keep some of your money invested in stocks

Once you start relying on your nest egg, you can't afford to leave money in the market to wait out downturns. Because that money needs to be accessible, many seniors transfer their investments out of stocks.

Unfortunately, if you do this, you're likely to run through your money much too quickly, thanks to low interest rates. To find out how much of your cash to leave invested, subtract your age from 110 -- that percentage of your portfolio should be left in stocks, if you want to continue earning reasonable rates of return.

Planning ahead to save can help you avoid stress

All of these tips can be used by pre-retirees, and many are still helpful for people already living off retirement income. But the older you get, the fewer options you have to ensure your retirement remains financially secure.

If you start young, make a retirement savings plan, and stick to it throughout your career, hopefully you won't have to worry much about having too little saved to see you through as a senior.