Ask an Advisor: We're in Our 70s With $120k Saved and Social Security. How Can We Stretch Our Retirement Income?
Again, I’m not saying that you should stop saving – I don’t know why you are in the first place – but I would encourage you to think very critically about why you’re saving that much. (And if you need more help managing your finances before or after retiring, consider speaking with a financial advisor.)
Where Do You Keep Your Money?
It’s also worth taking a hard look at where and how you hold your savings. A savings account won’t provide much interest, although high-yield savings accounts are currently paying over 5% (as of January 2024). I’m sure you’re a pretty conservative investor. But, even a diversified portfolio of mostly bonds and certificates of deposit (CDs) could boost your savings without adding too much risk.
I’m not sure what your experience with investing is. However, it’s possible that with some self-study or a little guidance you could become more comfortable with adding a little equity to the mix as well. This could significantly increase your long-term returns.
Just be mindful of the increase in volatility. Investing too heavily in equities during retirement could expose you to unnecessary risk and a significant loss in the value of your portfolio during market downturns. However, investing too conservatively could lead you to deplete your assets early.
For some context, a portfolio of 60% stocks and 40% bonds is generally regarded as the classic retiree portfolio. In other words, you are currently “invested” extremely conservatively by normal standards.
Between 1926 and 2021, a 60/40 asset allocation posted an average annual return of 9.9%, according to Vanguard. While that doesn’t mean you can expect a 10% return every year, it does show you how investing – even conservatively – can help you over a longer timeline. (And if you need help creating an investment plan, consider speaking with a financial advisor.)
Bottom Line
A tight budget with little savings is hard for anyone. It’s undeniably harder with constrained employment prospects. But again, money spent on providing a happy home for growing children and a 45-year marriage is a good use of it, in my opinion.
Based on your question, these are the two major items I’d look at first. There are probably additional factors to consider as well that aren’t apparent from your question. Your housing expenses (or equity you can access) and state tax situation (possible move for lower taxes?) may be big ones, for example.
Tips for Finding a Financial Advisor
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Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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Avoid the temptation to sign up with the first advisor you speak with. It’s a good idea to interview several advisors and ask them about their fee structures, areas of focus and whether they abide by fiduciary duty.
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Keep an emergency fund on hand in case you run into unexpected expenses. An emergency fund should be liquid -- in an account that isn't at risk of significant fluctuation like the stock market. The tradeoff is that the value of liquid cash can be eroded by inflation. But a high-interest account allows you to earn compound interest. Compare savings accounts from these banks.
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Brandon Renfro, CFP®, is a SmartAsset financial planning columnist and answers reader questions on personal finance and tax topics. Got a question you’d like answered? Email
Please note that Brandon is not a participant in the SmartAsset AMP platform, nor is he an employee of SmartAsset, and he has been compensated for this article. Questions may be edited for clarity or length.
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