Retirement looks straightforward from a distance. Stop working, live on savings and Social Security, enjoy the time you've earned. In practice, the transition is significantly more complicated — and the financial and personal mistakes people make in their 60s tend to be the kind that compound quietly over years before becoming difficult to correct.
The 60s are a decade of major financial decisions. When to claim Social Security. Whether to keep working part-time. How to draw down retirement accounts without running out of money. What to do about healthcare before Medicare kicks in. Each of these decisions has long-term consequences — and most people are making them without much guidance, often under the assumption that things will work out.
This guide covers the retirement mistakes that financial planners and retirement researchers see most consistently — not to be discouraging, but because knowing what the common pitfalls are is the most practical way to avoid them.
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Claiming Social Security Too Early
This is the single most common and most costly retirement mistake. The financial incentive to delay claiming Social Security is substantial — and most people don't take advantage of it.
Social Security benefits can be claimed as early as age 62. Full retirement age is currently 66 or 67, depending on birth year. For every year benefits are delayed beyond full retirement age, up to age 70, the monthly benefit increases by approximately 8%. That means someone who delays from 66 to 70 receives a benefit roughly 32% larger — for the rest of their life.
For someone in reasonable health who lives into their 80s or beyond — which is the statistical expectation for a 65-year-old today — delaying Social Security is one of the highest-return financial decisions available. The break-even point, where the larger delayed benefit overtakes the cumulative value of earlier payments, typically falls somewhere around the mid-70s. For anyone who reaches that point, delayed claiming will have been the better choice.
The reason most people claim early anyway comes down to a combination of anxiety about leaving money on the table, the assumption that benefits might be cut, and a genuine need for income. All of those concerns are understandable. But for people who have the option to delay — through continued part-time work, a spouse's income, or drawing on savings temporarily — the long-term math strongly favors waiting.
For married couples, the calculus is even more significant. When one spouse dies, the surviving spouse keeps the larger of the two Social Security benefits. Maximizing the higher earner's benefit through delayed claiming can meaningfully improve the surviving spouse's financial security for potentially decades.
Underestimating How Long Retirement Will Last
People routinely underestimate their own life expectancy — and retirement plans built on that underestimation run out of money before the person does.
A 65-year-old man in the United States today has a life expectancy of approximately 83 years. A 65-year-old woman can expect to live to around 86. But those are averages. Roughly one in four 65-year-olds will live past 90, and one in ten will reach 95. For couples, the probability that at least one partner lives into their 90s is higher still.
Retirement plans that assume a 20-year retirement — common when financial planning rules of thumb were developed decades ago — are increasingly inadequate. A plan built for 20 years that needs to last 30 leaves a significant gap. The practical implication is that investment portfolios need to maintain more growth-oriented assets for longer than most people are comfortable with, and that spending in the early years of retirement needs to account for the possibility of needing funds 25 or 30 years out.
This doesn't mean assuming the worst-case scenario and living anxiously. It means building a plan that works for a long life, not just an average one.
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Ignoring Healthcare Costs Before Medicare
Medicare coverage begins at 65. For people who retire before then — and a significant number of people do, whether by choice or circumstance — the gap between leaving employer-sponsored insurance and Medicare eligibility is one of the most financially dangerous periods in the retirement transition.
Private health insurance for a 62 or 63-year-old without employer subsidies is expensive. Depending on location and coverage level, premiums can run $700 to $1,200 or more per month per person — before deductibles and out-of-pocket costs. Many people who retire early without accounting for this find that healthcare costs alone consume a large portion of their planned spending budget.
The Affordable Care Act marketplace offers coverage options, and for people whose income falls within certain ranges, subsidies can be substantial. But navigating the options and understanding how retirement income affects subsidy eligibility requires planning — ideally before leaving employment.
Even after Medicare begins at 65, healthcare costs in retirement are often underestimated. Medicare does not cover everything. Dental, vision, and hearing care are not covered under Original Medicare. Long-term care — the cost of in-home assistance or nursing home care that becomes necessary for many people in their later years — is not covered. A couple retiring at 65 today should reasonably expect to spend several hundred thousand dollars on healthcare costs over the course of their retirement, according to estimates from Fidelity and the Employee Benefit Research Institute.
Withdrawing From Retirement Accounts Without a Strategy
Having money in a 401(k) or IRA is one thing. Knowing how to draw it down in a tax-efficient way over 20 or 30 years is something most people haven't thought carefully about — and the difference between a thoughtful withdrawal strategy and an improvised one can amount to tens of thousands of dollars in unnecessary taxes.
A few specific issues come up consistently.
Required Minimum Distributions begin at age 73 under current rules. Many people arrive at 73 with large tax-deferred accounts and are surprised to find that the mandatory withdrawals push them into a higher tax bracket, increase their Medicare premiums through the Income-Related Monthly Adjustment Amount, and trigger taxes on a larger portion of their Social Security benefits. The time to plan for RMDs is in the years before they begin — not after.
Roth conversions in the early years of retirement, before RMDs begin and potentially before Social Security is claimed, represent an opportunity that many people miss. Converting a portion of traditional IRA assets to Roth in years when income is relatively low can reduce future RMDs, reduce lifetime tax burden, and leave tax-free assets for a surviving spouse or heirs. Whether this makes sense depends on individual circumstances — but it's a strategy worth understanding.
Sequence of returns risk is the risk that poor investment returns in the early years of retirement, combined with ongoing withdrawals, can permanently depair a portfolio in ways that good returns later cannot fully repair. This is why the years immediately before and after retirement are referred to as the "fragile decade" — and why having a plan for how to adjust withdrawals in down markets matters more than most people realize.
Carrying Debt Into Retirement
Entering retirement with significant debt — particularly a mortgage, but also credit card balances or car loans — reduces financial flexibility in ways that become increasingly difficult to manage on a fixed income.
This doesn't mean that everyone needs to pay off their mortgage before retiring. In some cases, the math favors keeping a low-rate mortgage and maintaining the cash elsewhere. But high-interest debt — credit card balances especially — carried into retirement is a persistent drain that compounds against a fixed income. The interest costs money that could otherwise support spending or remain invested.
The more important issue is that debt reduces the margin for error. A retired person with no debt and modest income has significant flexibility. The same person with monthly debt obligations has much less ability to absorb unexpected expenses — a medical cost, a home repair, a car replacement — without disrupting their financial plan.
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Underestimating the Non-Financial Side of Retirement
Financial mistakes get the most attention in retirement planning discussions. But one of the most consistent findings in retirement research is that the people who struggle most in retirement often struggle not because they ran out of money, but because they hadn't thought about what they were retiring to.
Work provides more than income. It provides structure, purpose, social connection, and identity. When it ends abruptly — particularly for people whose work was central to their sense of self — the loss can be disorienting in ways that catch people off guard. Depression and anxiety are significantly more common in the first year or two after retirement than most people anticipate.
The people who transition most successfully into retirement tend to have thought in advance about what they want their days to look like. Not in a vague "travel and relax" sense, but specifically — what regular activities will provide structure, what relationships will provide connection, what pursuits will provide purpose. This doesn't require a rigid plan. It requires having given the question serious thought before the transition happens rather than after.
Part-time work, volunteering, learning something new, deepening existing relationships — these aren't just pleasant additions to retirement. For many people, they are what makes retirement sustainable and satisfying over the long term.
A Practical Checklist for the Decade Before and After Retirement
| Area | What to Address |
|---|
| Social Security | Model delayed claiming scenarios; don't default to early |
| Life expectancy | Plan for a 25–30 year retirement, not 20 |
| Healthcare | Account for costs before Medicare; estimate post-65 costs |
| Tax strategy | Plan RMDs, consider Roth conversions before 73 |
| Debt | Eliminate high-interest debt before retiring |
| Portfolio | Address sequence of returns risk in the fragile decade |
| Purpose & structure | Plan what you're retiring to, not just from |
Closing Thoughts
Most retirement mistakes aren't the result of bad luck or unusual circumstances. They're the result of decisions made without complete information — claiming Social Security at 62 because it felt like the right time, assuming retirement would last 20 years because that's what the calculator said, spending freely in the early years without accounting for what healthcare would cost at 80.
The 60s are a decade when getting these decisions right matters enormously — not just financially, but in terms of what the next 20 or 30 years actually look like. Most of the common mistakes are avoidable with a reasonable amount of planning and a willingness to think carefully about a longer horizon than feels immediately necessary.
That planning doesn't require a financial advisor, though working with one can help. It requires honest thinking about income, spending, health, and — perhaps most importantly — what a good retirement actually looks like for you specifically.
This article provides general educational information about retirement planning for adults in their 60s. Individual financial circumstances vary significantly — specific decisions about Social Security, tax strategy, and investment withdrawal should be discussed with a qualified financial advisor.
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