Nearing Retirement With Only $200,000 Saved? Here's What to Do.

You've probably heard about the importance of saving for retirement for much of your career. And you may have done your best to build a solid nest egg.

But if high living costs, stagnant wages, and unplanned bills thwarted your retirement savings efforts, you're not alone. Workers ages 65 to 74 had a median retirement savings balance of $200,000 as of 2022, the last year there's data available, according to the Federal Reserve. But that's not a ton of money to fund a retirement with.

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In fact, if you apply the 4% rule to a $200,000 nest egg, you get an annual income of $8,000, not including adjustments for inflation. It's not nothing, but it's not a lot.

If you're getting close to retirement with only $200,000, try not to panic -- and do these things.

1. Try to work a bit longer

If you're being pushed out of your job or your health isn't strong enough to support a full-time role, you may need to retire on schedule. But if you're able to keep working, it pays to do so.

Putting in even a couple more years could help you boost your IRA or 401(k). Just as importantly, it allows you to leave your existing savings alone so that money potentially lasts longer.

2. Delay Social Security for larger checks

Once you reach full retirement age, which is 67 for anyone born in 1960 or later, you're entitled to your monthly Social Security benefits based on your earnings history without any sort of reduction. But if you're able to wait on Social Security a bit longer, you can snag much larger checks.

For each you delay your claim past full retirement age, up until age 70, your benefits grow 8%. And that boost is one you get to enjoy permanently.

Plus, remember that Social Security benefits are eligible for an annual cost-of-living adjustment (COLA). The larger your monthly checks are to begin with, the more valuable those annual raises are apt to be for you.

3. Make a plan to reduce your retirement costs

If you're nearing retirement with limited savings, you may have to rethink the lifestyle you're imagining. That could mean downsizing into a smaller home or relocating to a part of the country where costs are lower in general.

The good news? Changes like these might work to your benefit. The upside of having less square footage at home, for example, is having less maintenance to do. And you may find that relocating gives you access to a better climate and local amenities compared to what you have now.

Nearing retirement with $200,000 in savings isn't optimal. But it's also far from a hopeless situation. And if you work a bit longer, wait on Social Security, and tweak your spending plans, you may find that you're able to manage well on the savings you have.

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