7 Costly 401(k) Mistakes People Make in Their 80s (And the Price They Pay)

Many retirees in their 80s regret some of their 401(k) decisions. They have the gift of hindsight and experience living as retirees for a long period of time. Some of them regret not saving enough and not asking for help when they needed it. Others regret not learning how to budget or plan their withdrawals more effectively.

By reading about their mistakes, workers nearing retirement can learn from them and find ways to stretch their retirement dollars further. Here are the top seven regrets retirees in their 80s have about how they handled retirement planning.

Not saving enough

A Bankrate survey found that more than 20% of Americans regret not saving for retirement earlier. Many retirees in their 80s consider this a major 401(k) mistake, especially if their retirement savings are dwindling as they enter the later years of life.

Not saving enough for retirement is a major problem. In fact, in 2024, a Wall Street Journal survey found that one in eight retirees planned to go back to work. Many people who thought they were ready to stop working found their retirement lifestyle unaffordable, leading them to return to work.

Having no emergency fund

In a recent study, the Center for Retirement Research found that retirees spend about 10% of their fixed income on unexpected costs and emergencies. 

When the unexpected happens, like a medical emergency, a major house repair, or a natural disaster, paying for these expenses can put a large dent in a retiree's nest egg. Many retirees in their 80s regret not having a larger emergency fund to handle the unexpected.

Underestimating health care costs

Most retirees expect their lifestyles to become more affordable when they retire. After all, many retirees no longer have children in their homes, and many of them pay off their mortgages by the time they retire, which frees up cash flow. However, with age comes other concerns, like health care. 

One mistake people in their 80s make is underestimating the cost of health care expenses, which can be more than $170,000 during retirement, according to Fidelity.

Not having a withdrawal strategy

Another regret people in their 80s have is not having a well-thought-out 401(k) withdrawal strategy. Many retirees worry about withdrawing too much from their accounts and not having enough to live on later on. Others aren't sure of the best order for withdrawing funds if they have multiple types of retirement accounts. 

A financial advisor can help retirees create a plan and choose the most appropriate withdrawal rate depending on their goals and the amount of their nest egg.

Never learning how to budget

Many retirees in their 80s also wish they'd learned how to live on a budget sooner. 

The transition from a salaried job to a fixed income can be challenging for many people. In fact, according to a recent Lending Tree analysis, 97% of adults who are retirement age have some form of non-mortgage debt, such as car loans, student loans, and credit card debt. Having several payments to make each month toward debt can be stressful and prevent retirees from using their retirement funds for other expenses, such as travel.

Treating all distributions as spending money

Many people think of retirement as the point in life where you withdraw money from your retirement accounts, but the truth is, you can still invest excess funds in the market and continue to grow your nest egg. After all, some people can be retired for 20 to 30 years, which is a long investment horizon. Many retirees regret not continuing to invest in the market even after they stop working.

​​

Relying too much on Social Security

To have enough money in retirement, retirees need a combination of income streams. 

Many retirees in their 80s regret relying too much on Social Security. While their Social Security checks might have been enough to live on at the beginning of their retirement years, inflation and rising food costs have made things much more expensive. 

Social Security was never meant to fund retirement in its entirety, only to supplement other savings. The same is true for 401(k) plans. Retirees will likely need a few different streams of income, so relying on one to cover all expenses is a mistake many retirees make.

Where to get financial help

If you're a retiree who needs help with managing retirement income, consult with a licensed financial planner and an accountant. These professionals can help you plan a withdrawal schedule and a tax strategy that are most advantageous to you. 

If you need financial assistance in your 80s, there are numerous resources and volunteer organizations that can help.

Bottom line

Many people in their 80s have been able to retire comfortably, while others have made money mistakes that have made their retirement lifestyle more challenging. By learning about the seven costly mistakes listed above, people nearing retirement can better prepare for the future.

You May Also Like

Almost 80% of Americans Fear a Retirement Age Increase — Here’s the Real Reason Why

Read More

10 Smart Money Moves to Retire

Read More

The Easiest Way to Diversify Your Investment Portfolio With Fine Art

Read More

7 Brilliant Ways to Build Wealth After 40

Read More

5 Ways Seniors Are Throwing Away Money

Read More

Best High-Yield Savings Accounts of February 2026: Earn Up to 4.21% APY

Grow your savings faster with these high-yield savings accounts

Read More

Have $150K+ in Assets? See If You Can Retire Early

Zoe Financial Benefits

• Get matched with vetted and fiduciary-certified financial advisors
• Take the mystery out of retirement planning
• Their matching tool is free

Find an advisor

Paid Non-Client Promotion

FinanceBuzz doesn’t invest its money with this provider, but they are our referral partner. We get paid by them only if you click to them from our website and take a qualifying action (for example, opening an account.)

---

Subscribe Today

Unlock the Best Banking Deals and Bonuses

From high-yield savings accounts to cashback checking and sign-up bonuses, we bring you the best banking offers to grow your money smarter.

or

SEE TOP BANKING OFFERS →

By submitting this form you agree to receive emails from FinanceBuzz and to the privacy policy and terms