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Retirement is a milestone that many people look forward to with great anticipation. While the freedom of having more time to spend with loved ones, pursue hobbies, or travel is certainly something to be celebrated, it is also important to plan, save, and invest so this future can be a reality.
It’s never too late to start saving and investing for these future goals, even if you’re nearing 60. And if you’ve been saving for years, it’s still smart to continue to invest for retirement when you reach 60. However, your investment strategies may need to change as you near the end of your working years. This guide will talk about some important things to think about when investing for retirement at age 60, as well as some low-risk options that may work for people who are getting close to retirement.
Hey there, fellow soon-to-be or current retirees! If you’ve hit the big 6-0 or you’re approaching it, you’re probably wondering what the heck you should do with your money now. I mean, we’ve spent decades saving up, and now we gotta figure out how to make that money last while still growing it a bit. It’s a tricky balance, right?
I’ve been researching this topic like crazy lately (mostly because I’m helping my parents with their retirement planning), and I wanted to share what I’ve learned about smart investment choices for folks in their 60s. Let’s dive in!
The Balancing Act: Growth vs. Safety
When you hit 60, your investment strategy needs a serious reality check. You’re not that 30-year-old who can take big risks anymore, but you’re also not ready to put everything in super-safe, low-return investments either. Why? Because you might live another 20-30 years, and inflation can seriously erode your savings if you’re too conservative.
As Todd Campbell from Motley Fool wisely points out, “eliminating stocks from your portfolio exposes you to a different kind of risk the risk that you’ll exhaust your savings because they’re not growing fast enough to keep pace with inflation”
So what’s the right balance? Most financial experts suggest a more moderate approach. Let’s look at some specific investment options that make sense at this life stage.
Maxing Out Retirement Contributions (If You’re Still Working)
If you haven’t retired yet, keep pushing those retirement contributions as high as possible! According to Edward Jones, as of 2025, you can contribute:
- Up to $23,500 to your 401(k) plan
- An additional catch-up contribution of $7,500 (for those over 50)
- A higher catch-up contribution of $11,250 for those ages 60 to 63
That’s a total potential contribution of $31,000 to $34,750 depending on your exact age! That’s pretty substantial and can really boost your retirement savings in these final working years.
Target-Date Funds: The “Set It and Forget It” Option
Goal-date funds are one of the best ways to get the right mix of stocks and bonds. As you get older, these funds change your asset allocation for you, making it more conservative over time.
For example, if you’re 60 and planning to retire around 2025-2030, you might consider something like the Vanguard Target Retirement 2020 Fund. According to Motley Fool’s analysis, this fund typically has:
- About 55% in stock funds
- About 45% in bond funds
The specific breakdown often looks something like this:
| Fund Type | Approximate Percentage |
|---|---|
| U.S. Total Stock Market | 33% |
| U.S. Bond Market | 29% |
| International Stocks | 22% |
| International Bonds | 12% |
| Inflation-Protected Securities | 4% |
What I love about target-date funds is their simplicity. You don’t have to rebalance or adjust your portfolio – they do it for you! Plus, they often have really low expense ratios (like 0.14% for some Vanguard funds), which means more money stays in your pocket.
ETFs: Build Your Own Portfolio
ETFs, or exchange-traded funds, are great if you want to make changes to your portfolio and are more hands-on. They offer:
- Lower expense ratios than traditional mutual funds
- More flexibility to buy and sell throughout the day
- The ability to focus on specific market segments
Some solid ETF options for 60-year-olds might include:
- Vanguard S&P 500 ETF (VOO) – For broad U.S. stock market exposure
- Vanguard FTSE Developed Markets ETF (VEA) – For international exposure
- Vanguard Total Bond Market ETF (BND) – For broad bond market exposure
- Vanguard Tax-Exempt Bond ETF (VTEB) – Especially good if you’re in a high tax bracket
You could make a portfolio that fits your risk tolerance with these types of ETFs. If you’re willing to take on some risk, maybe something like 20%50%20stocks%20and%2050%%20bonds. If you’re more of a conservative investor, maybe something like 20%60%20stocks%20and%2060%%20bonds.
Individual Dividend-Paying Stocks
Focusing on stable, dividend-paying companies can give you both growth potential and income if you’re good at picking individual stocks, which isn’t for everyone. Think about big, well-known companies that have been paying and raising dividends for a long time.
Companies in sectors like:
- Utilities
- Consumer staples
- Healthcare
- Energy
These tend to be less volatile and offer decent dividend yields. For instance, energy giants like ExxonMobil have historically offered dividend yields around 3.9%, though remember that all individual stocks come with company-specific risks.
Repositioning Your Portfolio for Retirement
According to Edward Jones, as you shift from saving to spending, you’ll want a more balanced approach. One sample allocation for a 60-year-old might look like:
- 50% Stocks: Focus on dividend-paying stocks and broad market index funds
- 35% Bonds: Mix of short to intermediate-term, high-quality corporate and government bonds
- 10% Alternatives: REITs or natural resources to hedge against inflation
- 5% Cash: For immediate expenses and emergency needs
This kind of portfolio aims to generate steady income while still providing some growth potential to combat inflation.
Don’t Forget About Healthcare Planning!
One thing that often gets overlooked when discussing investments at 60 is planning for healthcare costs. This is HUGE! Medicare doesn’t kick in until 65, so if you’re retiring before then, you need a plan for those gap years.
Even after Medicare eligibility, there’s a lot it doesn’t cover – deductibles, copays, prescription drugs, and long-term care. Some smart investment strategies should include:
- Health Savings Accounts (HSAs) if you’re still eligible
- Setting aside specific funds for healthcare expenses
- Considering long-term care insurance or alternatives
Creating Your Retirement Paycheck
This is where the rubber meets the road. How do you actually turn your investments into income? Several approaches work well:
-
Social Security strategy – When to claim makes a big difference! Claiming at 62 could reduce your benefits by up to 30%, while delaying until 70 could increase them by up to 32%.
-
The 4% rule – A general guideline is that you can withdraw about 4% of your portfolio in the first year of retirement, then adjust that amount for inflation each year. This is a starting point, though you might need to adjust based on your specific situation.
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Income-generating investments – Focus on investments that pay you regularly:
- Dividend stocks
- Bonds
- Annuities (for some guaranteed income)
- REITs (Real Estate Investment Trusts)
Pressure-Testing Your Retirement Plan
One really important step is to “stress test” your investment strategy against different scenarios. What happens if:
- You live to 95 or beyond?
- There’s a major market downturn right after you retire?
- Inflation runs higher than expected?
- You face unexpected health care costs?
These scenarios can help you identify weaknesses in your plan and make adjustments before they become real problems.
Consider Consolidating Your Accounts
If you’re like most people, you’ve probably accumulated multiple retirement accounts over your working years. It might be a good time to consolidate them. According to Edward Jones, this offers several benefits:
- Easier management of investments
- Streamlined paperwork
- Potentially reduced fees
- Simplicity for your beneficiaries
IRAs at different providers can be consolidated anytime without tax consequences, and 401(k)s can typically be rolled over to IRAs when you retire.
Don’t Forget to Designate a Trusted Contact
This is something I hadn’t thought about before, but it makes so much sense! As we age, having a trusted person who can be contacted if there are concerns about fraud or diminished capacity is super important. This person doesn’t have access to your accounts but can be a point of contact if something seems off.
My Final Thoughts
Hitting 60 doesn’t mean you should panic and move everything to super-safe investments. You still need growth to fund what could be a 25-30 year retirement! But it does mean being more thoughtful about risk and focusing on income generation alongside moderate growth.
The ideal investment mix for a 60-year-old typically includes:
- A healthy portion of high-quality stocks or stock funds (40-50%)
- A significant allocation to bonds (35-45%)
- Some alternative investments for diversification (5-10%)
- A cash cushion for immediate needs (5-10%)
I think the most important thing to remember is that there’s no one-size-fits-all approach. Your investment strategy should reflect your personal situation – your health, your family longevity, your retirement timing, and your goals (like leaving an inheritance or not).
What are you investing in now that you’re near or at retirement age? I’d love to hear your thoughts in the comments!
Until next time,
[Your Blog Name]
P.S. Don’t forget to review your estate plan too! Make sure your will, power of attorney, healthcare directives, and beneficiary designations are all up to date. This isn’t directly about investments, but it’s a crucial part of your overall financial picture at 60+.
Options for Investing for Retirement at Age 60
Investing for retirement at age 60 can be a confusing and daunting process, particularly for those new to investing. But with some planning, retirees can find the best options for their needs. The following are some options to help you invest for retirement at age 60:
A 401(k) is a tax-advantaged retirement savings plan offered by an employer. It can be helpful for people over 60 who want to save for retirement. A 401(k) plan allows you to save for retirement on a tax-deferred basis, which means that your contributions could reduce your taxable income for the current year, and your investment earnings grow tax-free until you withdraw the funds in retirement.
If your employer offers a 401(k), it can be especially helpful for people over 60 because it has a number of features that can help you save the most for retirement:
• Catch-up contributions: If you are 50 and over, you can make catch-up contributions to your 401(k) plan, which allows you to contribute more money to your account each year than younger participants. In 2024, the annual catch-up contribution is up to $7,500 more than the standard $23,000 contribution limit. In 2025, the annual catch-up contribution is up to $7,500 more than the standard $23,500 contribution limit. Also in 2025, those aged 60 to 63 may contribute an additional $11,250 (instead of $7,500), thanks to SECURE 2. 0.
Contributions matched by your employer: Many 401(k) plans let your employer match your contributions, which can help you save more for retirement. Maxing out your employer match can be an effective way of increasing savings.
• Several investment options: A 401(k) plan typically offers a range of investment options, including mutual funds, exchange-traded funds (ETFs), and individual stocks and bonds. These investment options allow you to diversify your portfolio and manage risk.
• Loan options: Some 401(k) plans allow you to borrow from your account, which can be helpful in times of financial need.
An individual retirement account (IRA) is a tax-advantaged investment account that provides a way to save for retirement outside of an employer-sponsored plan, such as a 401(k). An IRA can be an option for someone who is 60 years old and looking to save for retirement. There are two main types of IRAs: traditional and Roth.
For someone who is 60 years old, an IRA can offer a number of benefits in terms of retirement savings:
• Tax benefits: A traditional IRA provides tax-deferred growth on your contributions, meaning that you can deduct your contributions from your taxable income for the current year and pay taxes on the funds when you withdraw them in retirement. A Roth IRA provides tax-free growth on your contributions, meaning you can withdraw the funds in retirement without paying any taxes on the investment earnings.
• Catch-up contributions: Like a 401(k), you are eligible to make annual catch-up contributions to your IRA if you are 50 and over. For 2024, the annual catch-up contribution is $1,000 more than the standard $7,000 contribution limit. For 2025, as well, the annual catch-up contribution is $1,000 more than the standard $7,000 contribution limit.
Investing in real estate is another option to save for retirement. Real estate investments provide a source of passive income, which may help supplement your retirement savings and hedge against inflation. There are several ways that someone who is 60 years old can invest in real estate, including:
• Rental property: Investing in rental property can provide a steady stream of rental income, which can help to supplement your retirement savings.
• Real estate investment trusts (REITs): Some REITs own and manage income-producing properties. Investing in REITs can provide exposure to a diverse portfolio of real estate assets without the responsibility of managing the properties yourself.
Annuities may be an attractive investment vehicle for someone saving for retirement. An annuity is an investment product that provides a guaranteed income stream in exchange for a lump sum payment or a series of payments. It’s important to note that there are several types of annuities, each with unique features and benefits.
An annuity can offer many benefits for retirement savings:
• Guaranteed income: An annuity provides a guaranteed stream of income, which can help to provide financial stability in retirement.
• Protection from market downturns: Certain types of annuities can provide protection from market downturns, which can help to mitigate the impact of stock market losses on your retirement savings.
Investing for Retirement at 60
As you approach 60, retirement may be just around the corner. Maybe you’ve been saving for retirement your entire career. Or perhaps you started saving late and need to grow your nest egg quickly for your golden years. No matter the case, as retirement nears, you may wonder what to do to ensure financial stability.
Investing for retirement is critical to help you reach a comfortable financial position. But planning for retirement at age 60 may seem overwhelming. After all, there are several investment accounts you could open or continue to invest in, not to mention the various types of investments you could have in those accounts. With a little bit of research and planning, you can put yourself on the path of living comfortably in retirement.
If you’re beginning your investment journey, it’s better to start immediately rather than putting it off because you’re overwhelmed by the prospect of failing to meet your financial goals. It’s better to save and invest in different types of retirement plans now rather than put it off and have nothing down the road.
How Do I Start Investing at 60 Years Old?
FAQ
How can I build my wealth after 60?
If you are looking to make investments, consider lower-risk options, such as:Bonds. As you get older, it’s important to ensure you have a steady income. Equity funds of ETFs. Putting money into a fund or exchange-traded fund (ETF) could be a simple way to get extra money without doing anything. Multi-asset fund.
What is the $1000 a month rule for retirement?
The “$1,000 a month rule for retirement” is a simple way to figure out how much you need to save to have a steady monthly income in retirement. Usually, you’ll need to save $240,000 for every $1,000 you want to make each month. This rule, based on a 5% annual withdrawal and 5% annual return, suggests that withdrawing $1,000 a month from a $240,000 portfolio would provide that amount of income without depleting your savings.
Is it too late to invest at age 60?
It is possible to invest for retirement at age 60. But you should also think about other things, like how much money you have saved now, your retirement goals, and your overall financial situation, to figure out if investing for retirement at age 60 is the best thing for you.
How much money do I need to invest to make $3,000 a month?
If your aim is to generate a monthly income of $3,000 from your investments, understanding your anticipated average return is essential. Let’s imagine that you achieve a reasonable average annual return rate of 10%. In this scenario, an investment total of $360,000 would be required.
How to invest for retirement at age 60?
When it comes to how to invest for retirement at age 60, investors traditionally favored 60/40 portfolios. But inflation has changed the correlation between stocks and bonds.
Should I start investing at age 60?
It’s not too late to start investing for retirement at age 60. Before you start, consider your desired lifestyle during retirement and the amount of money you’ll need to support it. For instance, you may want to travel the world.
Should you invest in stocks if you’re a 60 year old?
Learn More Investors hitting 60 should consider target date mutual funds, equity and bond exchange-traded funds, and income-generating individual stocks for their portfolios. It’s common knowledge that as you get older, you should shift more of your assets into safe-haven investments, such as U.S. Treasury bonds.
Should you invest in a diversified portfolio at age 60?
A well-diversified portfolio can help manage risk and improve returns by spreading investments across various asset classes. At age 60, consider a mix of stocks, bonds, real estate, and other income-generating assets.
Should I invest in an IRA if I’m 60 years old?
An IRA can offer several benefits for retirement savings when you’re 60 years old: • Tax benefits: A traditional IRA provides tax-deferred growth on your contributions, meaning that you can deduct your contributions from your taxable income for the current year and pay taxes on the funds when you withdraw them in retirement.
How can a 60 year old save for retirement?
One option for someone who is 60 years old to save for retirement is investing in real estate. Real estate investments provide a source of passive income, which may help supplement retirement savings and hedge against inflation. There are several ways to invest in real estate, including: