Jan 12, 2026
A lot of retirement planning is focused on maximizing the size of your nest egg. Theoretically, the more money you have saved up, the more comfortable your golden years are likely to be.
In January 2025, 4,626 U.S. adults aged 18 or older told Northwestern Mutual they believe the ideal amount to retire comfortably is $1.26 million. (1)
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Another commonly cited benchmark is Fidelity’s income multiple guideline, which recommends aiming to have 10 times your annual salary put aside by the time you’re 67 years old. (2)
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Unfortunately, many retirees fall short of those targets. According to Empower, the median retirement savings for someone in their 60s is just $539,068. (3)
It’s easy to feel anxious about your future, especially if you haven’t saved as much as the experts say is necessary. However, you could be richer than you think if one or more of the following applies to you.
1. Mortgage-free
For most families, housing and shelter are the biggest expenses they have to deal with. So, owning a home free and clear of any mortgage is an ideal situation for your finances.
Many older Americans had the opportunity to purchase their homes when home prices were much cheaper. They’ve also had more time to pay their mortgages off.
Roughly 40% of all U.S. homeowners were mortgage-free as of 2023, according to the National Association of Homebuilders. And two-thirds of these mortgage-free homeowners were over the age of 60. (4)
These lucky people can enjoy a more comfortable retirement, even on a smaller nest egg, because they don’t have to worry about rent or paying a mortgage, which are traditionally among the largest expenses draining American incomes.
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2. Modest spender
As of 2023, a typical retiree spends nearly $65,149 a year, according to the U.S. Bureau of Labor Statistics’ Consumer Expenditure Surveys. (5) However, not everybody has the same lifestyle. If you spend less, you likely need fewer savings to live comfortably.
There are many ways to drive down your cost of living. You could, for instance, move in with family or move to a more affordable city or state. You could also downsize to reduce your utility bills and property taxes in retirement.
Regardless of your approach, a tighter budget allows you to live more comfortably on a thin retirement nest egg.
3. Traditional pensioner
A traditional defined benefit pension is becoming as rare as unicorns. According to the Bureau of Labor Statistics (6), only 14% of workers in the private sector have access to these traditional pensions, which offer an employer-funded guaranteed monthly payment for life based on factors such as salary and years of service.
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If you’re one of these lucky pensioners, you have an additional source of regular income that you can rely on. Effectively, the size of your nest egg matters less when you have a robust pension from a private company flowing into your account every month.
4. Low-tax bracket retiree
If you find yourself in a relatively low tax bracket in retirement, that’s a golden opportunity to pull off several maneuvers that can make your retirement more comfortable.
For instance, it’s more cost-effective to initiate Roth conversions when you and your partner are in a low-tax bracket. You could also consider selling some of the assets in your taxable brokerage account to harvest tax gains with lower tax liabilities.
For many retirees, especially those with sizable pre-tax savings, minimizing their tax burden is more practical than tightening budgets or chasing investment returns.
5. Flexible retiree
Flexibility can be a game-changer in retirement. Many retirees are reluctant to downsize their home, unable to adjust their spending or dependent on caregivers who live in high-cost cities.
If you have more control over where you live and how much you spend, you can easily adjust when there’s a market downturn that reduces the size of your nest egg and find a way to live comfortably with what you have. A flexible retiree needs less to live on than a rigid one.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
Northwestern Mutual (1); Fidelity (2); Empower (3); National Association of Home Builders (NAHB) (4); Federal Reserve Bank of St. Louis (5); U.S. Bureau of Labor Statistics (6).
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Vishesh Raisinghani is a financial journalist covering personal finance, investing and the global economy. He's also the founder of Sharpe Ascension Inc., a content marketing agency focused on investment firms. His work has appeared in Moneywise, Yahoo Finance!, Motley Fool, Seeking Alpha, Mergers & Acquisitions Magazine and Piggybank.
