How Middle-Class Retirees Can Make Their Money Last 25 Years or Longer
Written by
Jordan Rosenfeld
Edited by
Brendan McGinley
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The average retired American will likely live longer than their parents did, and thus, has a longer retirement to plan for, which means saving more money. Some people may be looking at as much as 25 or more years in retirement.
To help set yourself up for a successful retirement, financial advisors explained how middle-class retirees can make their retirement savings last 25 or more years.
Calculate Your Needs
The first thing for those near retirement to do is to calculate their financial needs so they can ensure their savings last 25 or more years, according to Steven Conners, CEP, founder and president of Conners Wealth Management.
Start by figuring out how much income you think will be coming in during retirement. “This should include any pensions, 401(k)s, real estate and other assets besides your Social Security to determine whether you’re on track,” he said.
Most importantly, make “conservative projections” so that you don’t find yourself running short.
“If you do not believe you have enough money to retire after doing calculations, then you need to potentially make some changes now,” Conners said.
Create a Detailed Spending Plan
Next, create a detailed retirement spending plan, according to Christopher Stroup, CFP and owner of Silicon Beach Financial.
“Know your essential vs. discretionary expenses, then align them with reliable income sources,” he said. This clarity helps you anticipate future needs, set safe withdrawal rates and adjust proactively rather than reacting when money starts to run low, he explained.
Consider Withdrawal Strategies
While a widely cited guideline is the 4% rule, Stroup pointed out that today’s longer retirements and market uncertainty often call for more flexibility. He suggested planning for a lower withdrawal rate of between 3% to 3.5% annually, adjusting spending as markets shift. “The key is sustainability as it’s important to withdraw enough to enjoy life, but not so much that your savings evaporate,” he said.
Delay Social Security
Delaying Social Security can significantly boost lifetime income, Stroup noted. “Each year you wait past full retirement age increases benefits by roughly 8% until age 70,” when the payout reaches its maximum. This higher, guaranteed income stream can reduce pressure on your portfolio, help your investments last longer and offer more stability during market downturns.
Take a Balanced Investing Approach
The closer you get to retirement, the more you should reduce investment risks. Stroup pointed out that while retirees still need their portfolio growth to outpace inflation, “too much risk can jeopardize stability.” He recommended a balanced investing strategy, with around 40% to 60% stocks and the rest in bonds and cash.
Save Strategically for Healthcare
Healthcare and long-term care costs can dramatically increase in retirement, and without good planning, can derail a retirement budget, Stroup warned. “Build dedicated savings buckets, consider supplemental insurance and explore hybrid life/long-term care policies,” he said.
Consider a Long-Term Care Policy
Conners also recommended considering a long-term care policy if it fits your needs. While Medicare Part A covers short-term inpatient hospital care and Part B covers outpatient medical services, Medicare does not cover long-term care.
If a long-term care policy isn’t quite right for you, newer products, such as asset-based annuities, allow your money to grow and, if needed, pay out — which you could then use for long-term care costs. If you put $100,000 into a long-term care annuity, for example, it could grow to 1 ½ or two times that amount or more, Conners explained. The advantage is that you don’t lose the money if you never need care, but if you do, you’ll have planned ahead and won’t feel the financial strain you otherwise might have.
Make Small Lifestyle Adjustments
As early as you can, making small, consistent lifestyle adjustments can extend savings meaningfully, Stroup suggested. From downsizing housing to reducing discretionary travel and tracking expenses, you can learn to live within sustainable limits.
“The goal isn’t austerity but aligning spending with what truly brings value, keeping your retirement both comfortable and lasting.”
Keep Part-Time Work
If you are able and interested, a modest side income through part-time work or a side gig can be significant, Stroup said. Even as little as $10,000 annually can reduce portfolio withdrawals, extending its lifespan dramatically.
It has other benefits, too. Conners pointed out that part-time work “can keep you busy and your mind sharp.”
Avoid Common Mistakes
Be sure to avoid mistakes like overspending early, ignoring taxes and investing too conservatively in your pre-retirement days, Stroup said. Retirees also run into trouble by not adjusting spending after market downturns.
Revisit Your Plan
Lastly, Stroup pointed out, “Retirement isn’t static so your plan shouldn’t be either.” Revisit your plan at least annually, or sooner if life circumstances change. “Regular reviews allow you to adjust for market shifts, tax law changes or evolving goals, ensuring your money stays aligned with your needs for decades,” he said.
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