Yes, one can retire on social security alone. According to the Social Security Administration, benefits make up 90% or more of the income of 36% of the people receiving benefits. So it is obviously possible to retire on Social Security alone, but it is less than ideal. If you are nearing retirement age and looking at Social Security make up almost all of your retirement income there are some things you can do to make living on just your benefit check a little easier.
The following items are based on what my own mother is doing. Social Security won’t be 90% of her income in retirement, but it will probably be at least 75% of her income.
- Paid Off Home/No Debt – My mom will have her house paid off and no monthly debt payments when she retires. That will free up a lot of room in her budget for other expenses.
- Live in a Low Cost of Living Area – The rural Midwest is a very cheap place to live. That is how my mother was able to buy a brand new home for $70,000. The low cost of the home made it possible for her to pay off the loan before she retires.
- Delay Retirement – Not retiring as soon as you reach the minimum age to draw Social Security benefits allows your monthly check to build up. My mom likes her job and is working a couple years past her retirement age to increase her check and finish paying off the house. This won’t be an option for everyone but if you are able to delay retirement you can reap the reward of larger monthly checks.
- Good Health – This is an item you can’t completely control. If you are healthy, do your best to remain healthy by eating right and exercising. Health care can easily kill a monthly budget when you are only drawing Social Security so do what you can to stay healthy.
Those are the main things you can do to help increase your chances of living comfortably on Social Security benefits alone. Of course, it is best to not have to live on just Social Security benefits. Opening an IRA or other investment account to save for retirement with Betterment.com can help you have a more comfortable retirement. Right now you can take advantage of the Motif Investing $100 Referral Bonus to help kick start your retirement investing. Just click on one of the affiliate links to open an account and get your bonus.