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12 Tips for Retiring With Just $50K Net Worth

So you’re a little low on your retirement savings? A lot of people have the same problem. In fact, one in four Americans don’t save any of their income for retirement, according to the 2021 Economic Well-Being of U.S. Households report from the Board of Governors of the Federal Reserve System. If you’re in that low-to-no camp, here are the things you can do to help shore up your finances for retirement.

Key Takeaways

  • Put any extra money you get, such as an inheritance, a raise, or tax refunds, to your retirement. 
  • Delay Social Security, downsize your home, get aggressive with budgeting, and freshen up your skills to boost your earnings capability.
  • Give up expensive habits and hobbies or, better yet, monetize a hobby.

Commit Your Raise

If you’re still working and get a raise, bonus, or some other form of extra compensation, commit it to your retirement savings. Unless you absolutely need that extra money to live on—and you probably don’t—your retirement funds are a great place to stow it. Do this by upping the amount that is deducted from your paycheck for retirement if it’s deducted on a pretax basis. Remember, even if you’re retired, you can still save for retirement.

Commit Your Tax Refund

We all want to use our tax refunds as play money, but if you’re behind on your retirement, that’s not a wise idea. You can deposit the money directly into an IRA using IRS Form 8888.

Commit Your Inheritance

See the pattern? Any time you come into extra money, don’t spend it. Instead, put it toward your retirement. It’s not nearly as fun, but you’ll thank yourself later.


The median retirement savings of Americans in Generation X (born between 1965 and 1978), per a Transamerica Center for Retirement Studies 2019 survey.

Invest in Your 401(k)

If your company is matching your contributions, you should invest in your 401(k). It’s free money. Even if your company plan isn’t very good, your company is paying you to be involved. “Save as much as you can in there until it hurts. Build this nest egg as fast as you can and also get a slight tax benefit since it’s pretax dollars you are contributing,” says Cassandra Toroian, founder and chief investment officer of Bell Rock Capital in Rehoboth Beach, Del.

If you have access to a 401(k) with matching contributions from your employer, make sure to contribute enough to it to get them—it’s free money.

Delay Social Security

If you don’t need Social Security when you’re first eligible at age 62, don’t take it. If you can wait until you reach 70, you could get nearly twice as much. That will likely mean working longer, but it might be worth it. “This will give you an automatic increase in benefit amount and cost-of-living adjustment and avoid unnecessary taxes on Social Security while you’re working and drawing the benefits,” says Chris Hardy, CFP®, EA, ChFC®, CLU®, founder and CEO of Paramount Investment Advisors in Suwanee, GA.

Re-evaluate Your Investments

In the investing world, little things add up fast. For example, if you’re invested in high-fee mutual funds or other investment products, consider some different choices. Fees can eat away at your savings. Higher fees do not equate to better performance. Craig L. Israelsen, Ph.D., founder of the 7Twelve Portfolio, located in Springville, Utah, says, “It is crucial for every investor—especially those retirees with a modest-sized nest egg—to keep the investment costs as low as possible,” adding that “[an annual expense ratio] below 25 basis points (BPS) is definitely the target; 10 BPS is achievable with Vanguard funds.”

Get a Cheaper Car

A car is just one example, but what are you spending money on that you could cut? The lawn service? A rarely used gym membership? Expensive subscriptions?

Downsize Your Home

Maybe all of the kids are gone, but you’re still living in that big house. How much could you bank for retirement if you sold your home and found something smaller? There are a lot of financial variables involved in this decision, so talk to a financial planner to see if it’s right for you.

Learn a New Skill

If you’re entering retirement, you probably don’t want to learn a skill that’s overly physical, but how about something like consulting work? Or maybe you’re good with computers and could learn a computer language. Learning something that can earn you extra money as you age means you can continue working well into retirement.

Give Up Expensive Habits

Easier said than done, right? However, if you can give up smoking a pack of cigarettes a day, that could be an extra $2,300 annually for retirement. How about drinking? Water is a lot cheaper than alcohol, and the savings can add up fast.

Give Up Expensive Hobbies

Once again, it’s not an easy choice to make, but your nest egg is more important than your hobby. How much is your golf game costing you? What about your boat? Whatever your expensive hobby, either give it up or, even better, find a way to monetize it. Become a golf instructor or start a charter service with the boat.

Get Aggressive With the Budget

First, if you don’t have a budget, start one. “A budget is like a roadmap or game plan. It clearly lays out your sources of income and expenses and the difference. By having it clearly in front of you, you can see how you can adjust your income or expenses to reach the overall savings goal you desire or need,” says Mark T. Hebner, founder and president of Index Fund Advisors, headquartered in Irvine, Calif., and author of Index Funds: The 12-Step Recovery Program for Active Investors.

If you’re already budgeting, it’s time to get more aggressive. Cut even more expenses. Maybe eat out only once per month, use more coupons, look for deals, and don’t go on that expensive vacation this year.

The Bottom Line

You’re probably not going to make a massive change to your retirement savings unless you get an inheritance or another large-scale blessing, but little changes add up fast. Just because you’re low on savings doesn’t mean it has to stay that way. Work longer, save more, and spend less—however that looks in your life.

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