How to Retire at 70: Step-by-Step Plan

While many people dream of retiring as soon as possible, others love their jobs and want to keep working. Workers who want to retire at 70 have multiple advantages over others who retire earlier. If you’re still working past the traditional retirement age, or just considering it, there are a handful of steps you should follow to maximize your chances for success.

A financial advisor can create or modify your retirement plans to ensure they meet your long-term goals.

1. Maximize Your Social Security Benefits

For every year that you delay claiming Social Security benefits, your monthly benefits increase by 8%. By delaying your claim from full retirement age to 70, you can earn delayed retirement credits of 8% per year with payments that are 24-32% higher than what you’d receive at full retirement age. This boost in income can provide greater financial security throughout your retirement years.

Be aware that up to 85% of your Social Security benefits may be taxable depending on your combined income. Strategic withdrawals from different retirement accounts can help manage your tax bracket and potentially reduce the taxation of your benefits. Consider consulting with a financial advisor to develop a tax-efficient withdrawal strategy that complements your Social Security claiming plan.

2. Consistently Contribute to Your Retirement Accounts

Working until age 70 not only provides income from your employment, it also provides an opportunity to continue contributing to your retirement accounts. Since you’re not withdrawing from your accounts, you’re benefiting twice. These benefits include the growth of your investments and the additional contributions you’re making. The money already in your accounts continues to grow based on market performance. And your additional contributions build upon that solid foundation for later years in life.

As your income grows throughout your career, consider incrementally increasing your retirement contributions. Many financial experts recommend boosting your contribution percentage with each raise or promotion. Even a 1% increase annually can make a substantial difference in your retirement nest egg without dramatically affecting your current lifestyle.

3. Sign Up for Medicare at Age 65

Even if you continue working past that age, you should sign up for Medicare at 65 anyway. Medicare penalizes people who don’t sign up at age 65, even if they plan to retire at 70 or later. If you wait until later to sign up, your coverage may see a delay when you finally decide to enroll. Additionally, your Medicare Plan B monthly premiums increase 10% for every 12-month period that you were eligible ¹ for coverage but didn’t sign up.

If you’re still working at 65 with employer coverage, you may be able to delay Medicare enrollment without penalty. However, this depends on your employer’s size and the specific terms of your health plan. Companies with fewer than 20 employees typically require you to enroll in Medicare as your primary insurance when eligible ² , while larger employers may offer different options.

4. Open a Brokerage Account

If you don’t already have a brokerage account, now is the time to open one up. You’ll soon need to start taking required minimum distributions from your retirement plans. A brokerage account is an excellent place to keep that money invested if those distributions are not needed to cover your daily living expenses. Plus, any money in these accounts will receive a step-up in basis for your beneficiaries. This means that they won’t have to pay any income taxes on the gains.

While 401(k)s and IRAs form the foundation of retirement savings, a brokerage account offers flexibility that these tax-advantaged accounts don’t provide. There are no contribution limits or withdrawal penalties, making them excellent vehicles for additional retirement funds. This flexibility becomes particularly valuable as you approach your target retirement age of 70, allowing you to adjust your investment strategy without worrying about early withdrawal penalties.

5. Diversify Your Portfolio Based on Your Risk Tolerance and Time Horizon

Once your brokerage account is established, focus on building a diversified portfolio aligned with your retirement timeline. At this stage, consider a balanced approach that includes both growth-oriented investments and more conservative options. Many brokerages offer retirement-focused model portfolios or robo-advisor services that can help you maintain an appropriate asset allocation as you move toward retiring at 70.

Your time horizon plays a crucial role in portfolio diversification when planning to retire at 70. Even at this age, your investments may need to last 20+ years, requiring some growth components. Consider that your earliest withdrawals might fund your immediate retirement years, while assets you won’t touch for a decade could remain in growth-oriented investments.

6. Consider an Annuity for Lifetime Income

One fear that retirees have is that they’ll outlive their income. This can be one of the reasons why they delay retiring at an earlier age. Many types of annuities can address those concerns because you cannot outlive its monthly payments. When you deposit a set amount of money, you’ll be guaranteed monthly payments for as long as you live. You can even buy a joint-and-survivor annuity that continues to pay until both you and your spouse pass away.

Not all annuities are created equal, and understanding the differences is crucial. Fixed annuities offer predictable payments, while variable annuities fluctuate based on investment performance. Immediate annuities begin payments shortly after purchase, making them attractive for those already at retirement age. Deferred annuities, meanwhile, allow your investment to grow before payments begin, which might be less beneficial when retiring at 70.

7. Evaluate Alternative Investment Opportunities

Traditional investments of stocks and bonds are the foundation of any good financial plan. But many investors are looking into alternative investments to diversify their assets and provide additional growth and income opportunities. Alternative investments range from the common (real estate, commodities, private equity) to exotic (cryptocurrency, NFTs, collectibles).

Before making significant changes to your investment approach as you near retirement, consulting with a financial advisor can help ensure your alternative investment choices align with your overall retirement goals. A professional can help you evaluate opportunities based on your specific timeline, risk tolerance, and income needs as you prepare for retirement at 70.

8. Put Together a Strong Estate Plan

Estate planning is a crucial component of retirement preparation, especially when planning to retire at 70. Creating a comprehensive estate plan does two things. It ensures your assets are distributed according to your wishes, and it minimizes potential tax burdens for your heirs. Start by drafting a will that clearly outlines how you want your property and possessions allocated after your passing.

Whether you’re 40, 70 or 100 years old, if you don’t have a valid will or even a living trust, your beneficiaries may struggle to handle your estate. In some cases, probate will even need to occur, which can be extremely stressful. Not only does this complicate matters, but it can cost a lot of money. Especially because probate fees are based on the value of your assets, not your net worth.

9. Distribute Assets Before Passing Away

One approach to consider when planning how to retire at 70 is making gifts during your lifetime. The IRS allows individuals to give up to a certain amount annually to any number of people without triggering gift taxes. This strategy can gradually reduce your taxable estate while allowing you to witness your beneficiaries enjoying your generosity.

Trusts offer another avenue for distributing assets before death. Depending on your situation, you might explore revocable living trusts that allow you to maintain control of assets while you’re alive, or irrevocable trusts that can provide tax advantages and asset protection. Each type serves different purposes within your broader retirement strategy.

How a Financial Advisor Can Help You Create a Plan to Retire at 70

Retiring at 70 comes with some distinct financial advantages, but turning those advantages into a reliable, lasting retirement plan still requires careful strategy. A financial advisor helps you structure everything you have built over a long career into an income plan that works for the decades ahead.

One of the biggest benefits of retiring at 70 is Social Security. By waiting until 70 to claim, you receive the maximum possible monthly benefit, significantly more than you would have received at 62 or even 66. A financial advisor will show you exactly how that increased benefit fits into your overall income picture and how to coordinate it with withdrawals from your retirement accounts to minimize taxes and avoid unnecessary shortfalls.

Required minimum distributions (RMDs) are another key consideration. At 73, the IRS requires you to begin withdrawing from traditional IRAs and 401(k)s whether you need the money or not. If you retire at 70, those distributions begin just a few years into retirement. An advisor will help you plan around RMDs strategically, potentially using Roth conversions in the years before they kick in to reduce your taxable income later.

Healthcare planning also deserves close attention. At 70 you are already enrolled in Medicare, which removes one of the biggest uncertainties early retirees face. However, supplemental insurance coverage, prescription costs, and the possibility of long-term care expenses still require planning. An advisor will help you budget for these realistically and evaluate whether additional coverage makes sense for your situation.

With a longer savings runway than most retirees, a 70-year-old entering retirement may also have a larger nest egg to manage. An advisor will help with asset allocation, balancing income generation with enough growth to protect against inflation over a retirement that could still span 20 or more years.

Bottom Line

More and more people are working later in life. Better health and longer lifespans allow more seniors to retire at 70 or even later. The financial benefits of this decision can be significant, especially when it comes to Social Security. If you follow the strategies above, you’ll hopefully find yourself well-situated financially to retire comfortably and enjoy your post-working life.

Tips for Retirement 

• While many of the steps above seem simple to some investors, many of us could use a helping hand. A financial advisor can offer guidance to set up these accounts and strategies to secure your retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• When planning to retire at a later age, your investments have more time to grow and ride out fluctuations in the market. SmartAsset’s investment calculator shows how your portfolio will grow based on several variables. You can adjust the starting amount, annual contributions, timeframe and annual returns to create numerous scenarios.

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