It's nice to start retirement knowing you have plenty of money socked away. But what if you're aiming to retire next year but only have $100,000 in savings?
If that's the boat you're in, it's not so unusual. Data from Northwestern Mutual found that the average 60-something only has $112,500 in retirement savings. So if you're heading into retirement with a mere $100,000, you're not so far off.
The bad news is that a $100,000 balance in your 401(k) or IRA may not provide you with very much annual retirement income. The good news, though, is that you may have a way to supplement your savings so you can avoid struggling while sticking to your preferred retirement date.
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You may not have to put off retirement
You might assume that retiring in 2024 won't be feasible if you only have $100,000 socked away. But if that's always been your plan, you may not have to abandon it just yet.
First, take a look at other assets and income sources you might have at your disposal. It could be that you earned decently throughout your career but had a lot of expenses, like putting your kids through college and graduate school, that derailed your retirement savings efforts.
If that's the case, you may be in line for a pretty generous monthly benefit from Social Security, thanks to your higher earnings. So that's one source of income you can look to.
Your home may be paid off at this point and worth a decent amount of money. If so, you could consider selling it and downsizing. Your sale proceeds could then be put into an investment account that generates added income that you can dip into, as needed.
Furthermore, as long as you're healthy enough, there's always the option of working part-time in some capacity after you retire. And that doesn't have to mean holding down a retail job or consulting in your former field, if that's not something you want to do.
You could sign up for a ride-hailing service and drive passengers around when you have downtime you're looking to fill. Or if you're someone who loves animals, you could moonlight as a pet sitter.
All isn't lost if your savings are limited
If you're approaching retirement with $100,000 in savings, some people might tell you not to resign from your career in 2024 but, rather, keep working to boost your cash reserves. That's not bad advice, but it's not the only advice.
You may be really eager to close out your career in the new year, especially if you find your job stressful and detrimental to your health. If that's the case, don't assume that you're doomed financially because you don't have very much in the way of savings.
In addition to seeking out different income streams on top of your savings, you could also decide to live very frugally to stretch your income as far as possible. And if that idea doesn't bother you, then you may be more than fine to stick to your plan of making 2024 the year your retirement becomes official.
