How to Make Your Money Last to Age 100

3. Build income streams

The key to supporting yourself through a long retirement is ensuring you have money coming in steadily. For many retirees, Social Security is their only guaranteed source of monthly income. (If you’re lucky enough to have a pension, that’s another.)

A different option could be purchasing an income annuity, a contract with an insurance company in which you invest a significant sum in exchange for guaranteed monthly payments for life. With this kind of annuity, there’s no risk of running out of income. “An annuity can effectively produce the same types of results for an individual that a pension plan would,” Pinsky says.

Other potential income streams include earnings from part-time work or renting a property to tenants or vacationers.

4. Create the right withdrawal strategy

Not only is it essential to build a substantial nest egg; you also need a durable strategy for drawing it down. For years, many financial advisers touted the 4 percent rule, a guideline that suggests that retirees take out 4 percent of their savings in their first year of retirement and bump up the dollar amount each year by the inflation rate. More recently, the financial adviser who created that rule adjusted it to a 4.7 percent withdrawal in the first year of retirement.

Whichever withdrawal rate you choose, it’s important to realize that it’s only a guideline, says Wes Moss, an Atlanta-based certified financial planner and author of What the Happiest Retirees Know: 10 Habits for a Healthy, Secure, and Joyful Life. Some years you might need a little more or a little less, but staying around that percentage increases the likelihood that you’re not taking out too much too soon. 

It also helps you preserve money to handle expenses that can arise later in life, such as long-term care costs. “You want to be cognizant of not maxing out your withdrawal rate too early, because you’ve got to save a little cushion for your life circumstances,” Moss says.

5. Be strategic with Social Security

Though you’re eligible to start taking Social Security retirement benefits when you turn 62, you’ll get a larger payment if you can afford to wait. Your monthly benefit grows by 5 percent to 8 percent annually for each year you wait until age 70, when you can claim your maximum benefit.

“If you’re 62 and you have no other option to pay for living expenses other than take [Social Security], then sure, you’d have to do that,” Urban says. But if you can hold off by working or tapping some other income, you’ll have a higher Social Security check for the rest of your life.

6. Consider semiretiring

The Corebridge Financial study found that around two-thirds of millennials and Gen Zers say they’re worried they’ll need to work longer to avoid running out of money in retirement.

Their concerns are valid. Nineteen percent of Americans 65 and older were working in 2023 — nearly twice the percentage 35 years ago. Not all do so just for the money, but doing at least some paid work in your retirement years will help stretch your savings.

That doesn’t have to mean continuing to toil away in a 9-to-5 job. More than a quarter of adults ages 50-plus are earning money via gig work and freelancing opportunities, a January 2023 AARP study found. That can provide flexibility, remote work options and opportunities to maintain social connections.

7. Protect your wealth from health care costs

Households led by someone 65 or older spent, on average, $8,027 per year on health care in 2023, according to the most recently available federal data. The longer you live, the more those costs will add up — especially if, like most older adults, you eventually need long-term care services, which Medicare does not cover.

Median annual costs for long-term care range from around $35,360 for a 20-hour-a-week home health aide, to $70,800 for a spot in an assisted living facility, to nearly $127,750 for a private room in a nursing home, according to insurance company Genworth’s annual Cost of Care Survey. That can quickly eat up the nest egg you and your spouse have spent decades building.

Long-term care insurance or a hybrid life insurance policy with long-term care coverage are two options that could help you pay for such services without sacrificing your savings, says Jordan Mangaliman, founder of GoldLine Wealth Management, a financial planning firm in Fullerton, California.

“When we’re thinking about health care, let’s say, God forbid, you have a heart surgery — for the most part, you’re not truly trying to pay that out of pocket. You have insurance for that,” he says. “The same thing goes for long-term care. Once you get to that bridge, you don’t want to have to use your own assets to pay for it. Same concept, and people overlook it.”

8. Consider housing costs

Your housing may be one of your biggest expenses in retirement. Even if you’ve paid off your mortgage, you still need to have money set aside for taxes and home maintenance.   

“Some people feel that retirement communities can offer convenience and security,” says Frank Davis, president of New Era Financial in Toms River, New Jersey. “With this decision, you must be mindful of HOA [homeowners association] fees, their history of increases and potential special assessments for major repairs.”  

Others may decide to move in retirement to a less expensive part of the country or live with a roommate to reduce their housing costs.

9. Don’t forget emergency savings

Having money stashed in a retirement account shouldn’t be your only priority. If you don’t have 18 to 24 months’ worth of emergency savings, you may be forced to tap into investments for an unexpected financial need, such as a roof replacement or a furnace repair.

Not only might you end up needing to sell stocks when the market is down, but money taken out of investment accounts earlier than planned would no longer have the potential to grow.

Your rainy day fund should be liquid so you can access it when a need arises. Consider parking the money in a high-yield savings account or a money market account.   

10. Stay flexible

However you prepare for a lengthy second act, it’s important to remember that “your retirement date is not a static date,” Pinsky says. Your strategy shouldn’t be rigid either.

“You can always adjust your plan,” he says. “Even in your late 50s or 60s, course corrections can help significantly. I’m such a big believer that living a long life and having a happy retirement should be a positive thing, not negative. The best way to do that is to take action.”