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Running out of money during your retirement can take the shine off your golden years, and the risk might be greater than you think.
After all, the average 79-year-old in America has another 8.6 years of life left for men and about 10.1 years for women, according to the Social Security Administration (SSA) (1).
Those are a lot of years left for spending, especially with the average retirement age hovering between 62 and 63.
In fact, the average annual spending for U.S. households ages 75 years and older was $55,834 in 2024, based on Federal Reserve Bank of St. Louis data (2).
With a modest monthly income from Social Security like $2,000, you could easily be forgiven for worrying about outliving your means.
And your nest egg might not get you as far as you expect. If you have $50,000 in savings, for example, Fidelity’s retirement calculator shows that if your money is invested at an average annual rate of return of 5%, you can afford to make nine yearly withdrawals of around $6,730. If you made monthly withdrawals instead, it would come out to $573 a month (3).
It’s no wonder personal finance experts like Suze Orman are taking notice.
“How many emails do I get saying, why did I take [Social Security] at 62? I’m now 92. I never thought I would live this long,” she said in a podcast episode from December 2025 (4). “It doesn’t cover anything.”
If you’re asking yourself the same questions, here are some steps you could take to stay afloat as you navigate this difficult financial situation.
First and foremost, you may have more options for financial security if you are a homeowner.
Homeowners — at any age — have the advantage of building equity, which can be a very useful safety net to tap into. Plus, once you have paid off the mortgage, you don’t have expenses like rent weighing you down.
At the same time, while owning a home can provide that safety net, the expenses of maintaining it can still be costly — especially during retirement.
If that’s the case, moving to a smaller, lower-maintenance home or a retiree-friendly community can reduce property taxes, utilities and upkeep. Downsizing can also free up capital and reduce monthly costs significantly.
Another option to consider is renting out a spare room to generate extra income if you want to stay in your current housing situation.
Read More: Approaching retirement with no savings? Don’t panic, you’re not alone. Here are 6 easy ways you can catch up (and fast)
On top of housing costs, health care is one of the biggest expenses retirees face.
No matter how tight your budget is, you might want to make sure you aren’t skimping out on your health. While Medicare can provide you with essential coverage, supplemental insurance can be pricey.
Older adults, particularly retirees with limited income, should check their eligibility for Medicare Savings Programs. These state-administered programs can help pay Medicare premiums, deductibles and copays for low-income retirees.
There’s also the SSA’s Extra Help program that offers assistance to reduce Part D prescription costs based on income and resources.
Consulting resources like Medicare.gov can help you stay on top of these programs, which can potentially save you hundreds, or even thousands, of dollars per year.
With standard health care covered, older adults should also plan ahead in case their health declines or if they can no longer age in place.
Long-term care insurance offers coverage that can aid with in-home assistance, nursing homes or assisted living facilities.
For example, GoldenCare has a range of insurance options based on your needs, including insurance products for long-term care, extended care and critical illness.
GoldenCare also has life insurance and annuities available, for American families seeking extra coverage.
If making health care decisions still feels overwhelming, you might also want to look into organizations like AARP, which is a nonprofit offering older adults an array of benefits.
For instance, AARP members get savings on prescriptions at over 66,000 pharmacies nationwide and eyewear savings from select retailers.
As one of the most trusted organizations for older Americans, AARP not only offers money-saving perks but can also help you make informed financial and health decisions.
AARP members even get access to guides so that you can make the most of Social Security, choose the right Medicare plan and uncover other government benefits — possibly saving you thousands of dollars.
Sign up with AARP today and get 25% off your first year.
Once housing and health care are addressed, your everyday spending becomes the next key lever to pull.
And life after 75 isn’t cheap.
Looking at numbers from the Consumer Expenditure Surveys program, for example, the average American over the age of 75 spent $7,168 on food and $6,855 on transportation in 2024 (2).
Expenses on that scale can really eat into your savings if you’re only taking in $2,000 a month from Social Security benefits.
That’s why stretching your income from Social Security benefits requires some discipline — but a frugal yet enjoyable lifestyle can still be within reach.
Getting the most out of your accounts starts with a monthly budget. After all, if you don’t know where your money is going, it will be hard to make sure you’re not overspending.
A quick daily check-in of your accounts can show you exactly where your money is going.
An app like Rocket Money can easily flag recurring subscriptions, upcoming bills and unusual charges by pulling in transactions from all your linked accounts.
This can help you cut unnecessary costs, and then you can manually redirect savings straight into your retirement fund. No spreadsheets, no guesswork, no stress. Small habits like this can make a big difference over time.
Rocket Money’s intuitive app offers a variety of free and premium tools. Free features include subscription tracking, bill reminders and budgeting basics, while premium features — like automated savings, net worth tracking, customizable dashboards, and more — make it easier to stay on top of your retirement contributions and overall financial goals.
Beyond budgeting, there are other expenses to watch out for.
You could try to limit dining out, subscriptions and non-essential purchases. There’s also buying in bulk, shopping for sales and utilizing food assistance programs if you’re eligible. Local food banks and utility assistance programs can also reduce your expenses.
Another way to drive down expenses is to look at your essential spending, like insurance policies.
Older adults can lose out on savings from failing to shop around for lower prices, and instead just sticking with the same insurer for decades. This can leave money on the table that could otherwise go toward funding your retirement.
If you’re questioning whether your insurance rates could be lower, it may be time to check out OfficialHomeInsurance.com, which helps you look for low rates for free.
In under 2 minutes, you can compare offers from over 200 reputable insurance companies and find the right home insurance coverage for you. On average, OfficialHomeInsurance.com users save $482.
Data from the U.S. Bureau of Labor Statistics suggests the average cost to insure a motor vehicle increased by over 60% between December 2020 and 2025 (6).
With rates continually creeping up, it’s a good idea to make sure your costs aren’t growing more than necessary.
With OfficialCarInsurance.com, you can compare quotes from trusted brands — including Progressive, Allstate and GEICO — to make sure you’re getting a good deal.
Their matchmaking system uses your location, vehicle details and driving history to find the lowest rate possible for your needs.
Deals can start at just $29 per month, and you can switch your policy in just minutes.
Even with meticulous budgeting, though, unexpected costs can derail a fixed-income lifestyle.
Many experts recommend that you keep at least three to six months’ worth of expenses available for emergencies. But Kristen Beckstead, a certified financial planner and vice president at First Horizon Advisors, told AARP that retirees should aim to keep 18 to 24 months’ of essential expenses in their emergency fund (7).
However, this amount of cash would be tricky to amass if your savings are limited, so it’s probably a good idea to maximize the savings you do have.
Regardless of what you manage to put aside, make sure it’s kept in a highly liquid account, such as a dedicated high-yield savings account.
That way, if you need immediate access to funds, you won’t have to sell off investments or take on debt.
For instance, the Wealthfront cash account gives you instant access to your money — a crucial feature for anyone selecting an emergency fund account.
Wealthfront’s Cash Account currently offers a base variable APY of 3.30%, and new clients can get a 0.65% boost during their first three months for a total APY of 3.95%. That’s over ten times the national deposit savings rate, according to the FDIC’s January 2026 report (8).
Plus, Wealthfront Cash Account balances of up to $8 million are insured by the FDIC through program banks.
All told, if you’re a retiree living on a tight income, it’s important to be proactive about emergency savings, take control over daily expenses and optimize your costs.
Although nothing is guaranteed, increasing your awareness of your saving and spending habits can help you feel more secure in your retirement.
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
Social Security Administration (1); Federal Reserve Bank of St. Louis (2); Fidelity Retirement Income Calculator (3); Suze Orman (4); Cotality (5); U.S. Bureau of Labor Statistics (6); AARP (7); Federal Deposit Insurance Corporation (8)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.