What if You Really Do Run Out of Money Before You Die?
By Edd and Cynthia Staton | Originally published by Next Avenue | October 2, 2025
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Studies show that older adults are more afraid of running out of money in retirement than dying. Are their concerns justified? What if they’re right?
“My 78-year-old father will totally deplete his savings within the next year. Living in Los Angeles, his monthly expenses are $2,500 more than his income from Social Security and a pension,” says Blair H. of Denver, Colorado (last name withheld by request).
“We found a senior living center near here where he could live and have money left over, but he refuses to move,” she continues. “Beyond renting out one of his bedrooms, I’m honestly not sure what he plans to do.”
“Beyond renting out one of his bedrooms, I’m honestly not sure what he plans to do.”
Blair’s poignant story is far from isolated. Statistics from the Employee Benefit Research Institute (EBRI) project that for those living in retirement for 20 years, the lowest income earners have an over 80% probability of exhausting their savings before death, along with almost 10% of top earners.
Ouch.
This isn’t merely a looming future problem. According to researchers at the University of Massachusetts Boston, half of today’s older adults living alone have insufficient financial resources to meet their basic needs.
Disturbingly, they report that the 32.1% of this group who live slightly above the poverty level make too much money to qualify for government assistance programs. Women, who live longer than men and historically have earned less than males, are even more vulnerable.
Limited Options
After savings and home equity are exhausted, the choices financially strapped older adults face are predictably grim. “The emotional and social consequences hit really hard,” says Paul Carlson, a CPA in Phoenix, Arizona. “It’s tough to plan or enjoy life when every decision suddenly has a ‘can I afford this?’ undercurrent.”
Scraping by on Social Security
Social Security benefits are designed to cover about 40% of the average worker’s pre-retirement income.
A recent survey by the Senior Citizens League found, however, that two-thirds of older adults depend on Social Security for more than half of their income, and for 27%, the monthly check is their sole source of income.
As the final baby boomers enter their retirement years, the numbers are expected to grow. “Basics like rent, meds and groceries are going to be a stretch for a lot of them,” says Carlson.
Pursuing Part-Time Employment
Older workers are already reading the tea leaves and postponing retirement to bolster deficient savings. “It’s not hard to imagine a lot of people continuing to work part-time in their 70s or 80s, just to cover bills,” says Carlson.
But what sorts of employment opportunities are available to the 65-plus crowd?
“It’s not hard to imagine a lot of people continuing to work part-time in their 70s or 80s, just to cover bills.”
“Side hustles can be wonderful solutions for seniors who need an untraditional safety net,” says Kathy Kristof, founder of Sidehusl.com. “You can get paid for caregiving activities like shopping and cooking through sites such as Nextdoor, driving kids to and from school through RubiRides, or watching/boarding animals through Rover.”
Moving In with Family
Boomerang kids — young adults who move back in with their parents after living on their own — are now facing competition from “boomerang grandparents” who can’t afford to live on their own. This scenario can strain family relationships and place unexpected financial pressure on adult children, not to mention the humiliation of older parents finding themselves in a never-imagined predicament.
If the situation proves untenable, “a lot of older people could end up in low-income senior apartments or HUD-subsidized housing. The rent is usually capped at 30% of their income,” says Carlson. “Cooperative housing where costs and space are shared with others or adult foster care homes with built-in support staff are other possibilities.”
Move to a Location with a Lower Cost of Living
Hippocrates famously said that “desperate times call for desperate measures.” While most older adults prefer to age in place, running out of money can force a change of address.
Downsizing to a smaller residence reduces the cost of overhead and maintenance. Moving to a different area of the country can greatly reduce one’s budget. As an example, the average cost of living in Massachusetts is over 23% higher than in South Carolina.
A more extreme option is the one we chose — move to another country. Since relocating to Ecuador 15 years ago, we have enjoyed a lifestyle many would consider upscale, financed with our Social Security income. An added bonus is waking up each day to year-round springlike weather.
“You have to get brutally honest about your spending. Know exactly what you can and can’t cut back and where every dollar goes.”
Your Call to Action
Despite all the worry, research indicates fewer than 20% of baby boomers are actually doing anything about this looming problem. Here are some proactive suggestions to take control of your financial future before it’s too late.
Stick with your budget. Most Americans claim to have a monthly budget, but 83% admit to overspending, usually with credit cards. To avoid this, set aside an emergency fund for unexpected expenses. “You have to get brutally honest about your spending,” says Carlson. “Know exactly what you can and can’t cut back and where every dollar goes.”
Pay off credit card debt. The average American aged 65–74 is burdened with $7,720 in credit card debt, the highest of any age group. Don’t be lulled into complacent behavior that quietly steals from your future. Make it your #1 priority to reach a zero balance as soon as possible, then commit to paying your charges in full each month going forward.
Commit to systematic saving. If you are within 10 years of retirement, interest rates on investments are less important than your rate of savings. Make maximum savings an integral part of your budget. As soon as income is deposited, pull money dedicated to savings from your account before you spend a dime.
Determine your future Social Security benefit. Use this online calculator to estimate how much money you will receive each month based on the age you choose to retire.
Calculate your future budget. “For motivation, use a basic retirement calculator and input worst-case numbers: low savings returns, rising medical expenses and high inflation,” says Carlson. “Let it punch you in the gut now, rather than when you’re 75.”
Address medical and possible long-term care costs. Besides poor planning and insufficient savings, unexpected medical costs are the biggest reason people run out of money in retirement. Fidelity Investments estimates a 65-year-old could need $165,000 in after-tax savings to cover health-care expenses. Focus on your health span to increase the odds of minimizing this expense.
Find news, advice, information, conversations and stories curated for people over 50 on Next Avenue – a nonprofit, digital journalism publication produced by Twin Cities PBS (TPT). Next Avenue is dedicated to covering the issues that matter and is public media’s first and only national publication for older adults.