Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below.
When it comes to planning for retirement, evaluating your nest egg is a big part of the process. The state of your retirement savings can heavily influence when you decide to retire.
Take Jim, 61, for example. He worked in corporate America for most of his career, and after he was laid off, he wondered if it might be time to take a step back. Before his layoff, he and his wife, Helen, made a combined $300,000 a year. They carry no debt and have a combined $1.5 million in savings.
While Jim would like to retire now, the decision hinges on several factors: When Helen plans to retire, how much they need to live comfortably, how long their savings will last, and the roles Social Security and Medicare will play in their plan.
To figure this out, let’s get into the numbers.
The retirement landscape has changed dramatically since the turn of the century. According to Pew Research, the pandemic increased the rate at which people left the workforce, with just over half of U.S. adults over 55 reporting that they were retired by the end of 2021. (1)
On the other hand, people are also increasingly working longer. In 2023, Pew Research found that 19% of Americans ages 65 and older were still employed, a rate that’s nearly doubled over the past 35 years. (2)
Meanwhile, life expectancy is increasing. That means the number of years between retirement and death is growing. According to the Social Security Administration, the average 65-year-old woman in the U.S. has 20.12 years left to live, while the average 65-year-old man has 17.48 more years. (3)
Of course, these are just averages, but one of the biggest risks to any retirement plan is outliving your savings.
If Jim and Helen live into their nineties, their money has to last nearly three decades — that $1.5 million might not be as much as you think.
What’s more, market downturns, higher-than-expected inflation and rising health care costs could erode their purchasing power over time. Medicare eligibility at 65 will help manage health care expenses, but supplemental insurance and out-of-pocket costs can still be substantial.
So, how do you keep your portfolio above water when the market wavers?
This is where alternative assets can step in. Unlike traditional stocks and bonds, alternative assets can be a powerful hedge against inflation — which can erode the value of your money over the long term.
Gold is a traditional safe-haven asset, meaning it’s an investment many flock to during times of market uncertainty. The precious yellow metal has also been on a historic bull run, breaching $4,000 per ounce in September. (4)
Plus, with a gold IRA, you can take advantage of significant tax benefits for your retirement. Thor Metals offers a gold IRA that allows investors to hold physical gold or gold-related assets within a retirement account, combining the tax advantages of an IRA with the protective benefits of investing in gold. This combination can make it an attractive option for those looking to hedge their retirement funds against economic uncertainties.
To learn more, you can get a free information guide that includes details on how to get up to $20,000 in free metals on qualifying purchases. Just keep in mind that gold is typically just one part of a well-diversified portfolio.
Another inflation-resistant alternative investment you could consider is commercial real estate.
Traditionally, direct access to the $22.5 trillion commercial real estate sector was limited to a select group of elite investors, but that’s changed with First National Realty Partners (FNRP). FNRP helps accredited investors diversify their portfolio through grocery-anchored commercial properties, without needing to take on the responsibilities of being a landlord.
Simply answer a few questions — including how much you would like to invest — to start browsing their full list of available properties.
FNRP also has a self-directed IRA (SDIRA), which allows you to invest for your retirement through tangible, income-producing assets that can offer predictable cash flows and long-term growth. With FNRP, your rental income and investment gains can grow tax-deferred in a SDIRA – maximizing your savings and diminishing your reliance on public markets.
With $1.5 million saved, Jim and Helen are ahead of many Americans. The median retirement savings for Americans between 55 and 64 was around $185,000, according to the Federal Reserve. (5)
However, financial planners often suggest that by the time you reach your early sixties, you should have between eight and ten times your annual income saved for retirement. For Jim and Helen, that would equate to a nest egg between $2.4 million and $3 million, meaning they’re far below target even if they’re doing well for their cohort.
There is no single “golden number” for retirement savings, because spending habits, health and lifestyle choices vary. That said, $1.5 million can provide a comfortable retirement for some, especially if at least one spouse continues to earn income and delays withdrawals from savings accounts.
The real question is whether Jim and Helen can maintain their current quality of life in retirement.
If both Jim and Helen retire this year, they could begin drawing from their retirement accounts without penalty.
Based on the commonly cited 4% withdrawal rule, a $1.5 million nest egg could give them about $60,000 annually, before taxes. That’s 80% less than the couple’s current level of annual income.
While it seems unlikely they would be able to comfortably live at a substantially lower level of income, there might be ways they can cut costs to live on a somewhat smaller nest egg. They could use Monarch Money’s all-in-one budgeting app to see where they’re over-spending and under-investing, to make the most of their money.
Monarch Money puts all your finances under one roof, from your banking statements to your investments. You can also add separate or joint accounts to your dashboard, which can be great for tracking anything from grocery runs to gas station fill-ups for couples. The app is also well reviewed. Forbes ranked Monarch Money as their best budgeting app for 2025, as did the Wall Street Journal.
And the best part? Monarch Money offers a seven-day free trial so you can see if it’s right for you. If you like what you see, you could then snag 50% off with code WISE50.
The earlier they retire, the more seriously they’ll need to take their budgeting.
For instance, if they claim Social Security at 62, the first year Americans are eligible for benefits, they would receive about 30% less per month than if they wait until full retirement age, at 67. They would earn less than half of what they could get if they delayed retirement until 70.
If Helen were to put off her retirement until 67, her Social Security benefits could significantly boost their income. If she delays claiming benefits until then, she will receive a higher payout for life. Jim could claim his benefit earlier, wait until full retirement age or even 70 to maximize his payout.
By combining withdrawals from their savings, Social Security and Helen’s continued earnings for the next six years, they could maintain their current standard of living until both are retired.
But, again, this would depend primarily on Helen’s plans and whether she’s hoping to retire now, alongside her husband.
Before deciding to retire, there are a few things that Jim and Helen should consider:
Creating a detailed retirement budget that includes health care, housing, travel and discretionary spending.
Working part-time or as consultants for extra income, so that Jim and/or Helen can reduce their withdrawals from savings in the early years. If Jim finds part-time work, this could give them not only a small financial bump but also a social connection.
Meeting with a financial planner to run simulations based on different retirement ages and market conditions.
One option would be to work with Advisor.com to find a financial advisor that suits their goals. All of Advisor.com’s financial experts are pre-vetted fiduciaries, meaning they have a legal obligation to act in your best interest.
After inputting your ZIP code to find a nearby advisor, you can set up a free call with no obligation to hire, so you can make sure they’re the right fit for your needs.
From here, Jim and Helen could revisit their investment allocation to balance income needs with long-term growth potential.
Retiring at 61 with $1.5 million and no debt is possible, especially with one spouse continuing to work for several more years.
However, if Helen and Jim retire together, they may need to change their lifestyle to adapt to their new annual income.
They should remember that the key to retirement success is understanding how long your money needs to last, and what lifestyle you want to maintain. In Jim and Helen’s case, Helen’s continued income could provide a cushion if she decides to keep working. But her decision should be grounded in careful planning, realistic spending expectations and an awareness of longevity risk — not to mention a conversation with a financial planner.
With the right strategy, Jim and Helen could transition into retirement with both financial security and peace of mind.
Join 200,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
