Can I Retire at 60 With $300,000?

While it’s possible to retire at 60 with just $300,000, you’ll most likely need to maintain a modest standard of living. To understand what a 60-year-old with $300,000 might face, it’s important to consider their income both before and after Social Security, as well as post-retirement expenses. The specifics for your exact situation may vary, but these calculations and estimates can help you determine what to reasonably expect if you retire at 60 with $300,000.

Consider working with a financial advisor as you explore your prospects for retiring early.

Income After Retirement: Social Security

To determine whether you can retire at 60 with $300,000, first look at your sources of income, including Social Security benefits.

Generally, the less money you make during your working years, the fewer benefits you receive in retirement. Earnings scale up to the maximum Social Security income; after this point, additional earnings no longer apply to your lifetime benefits.

The maximum taxable income changes annually in response to inflation. In 2025, the Social Security earnings cap is $176,100. You earn the most credits by reaching, but not exceeding, this amount.

If you earn less, you will collect fewer benefits when you retire. However, you won’t add to your benefit if you earn above this limit.

When you retire affects the size of your benefits. You receive the smallest amount of money if you claim at age 62, with the benefit increasing monthly until you reach the maximum benefit payment at age 70. The standard set of benefits is paid at full retirement age, which is either 66 or 67 for most people.

Finally, Social Security benefits are adjusted each year by the Social Security Administration and Congress based on inflation.

In August 2025, the average monthly benefit for retired workers was approximately $1,981. For the purposes of this article, we will assume a retiree who begins collecting benefits at full retirement age receives the average payment. You can calculate your own estimated benefits at the Social Security Administration’s website.

Income After Retirement: Investments and Savings

The average 401(k) balance in 2024 was $148,153, according to a 2025 Vanguard report. It is a noticeable increase from $129,157 in 2020 – and even $134,128 in 2023.

With a conservative 5% long-term rate of return, a retirement account with $300,000 will yield an average annual return of about $15,000. By withdrawing only investment returns, you can preserve your $300,000 principal.

If you have no other income sources beyond the average Social Security benefits, your 2025 income will be around $37,378 ($15,000 + $22,378), or about $1,864 a month.

Income Before Social Security

Depending on when you decide to start taking Social Security, the first two, six or eight years will be the most financially challenging.

For example, if you begin collecting benefits at the earliest age of 62, you cut your lifetime benefits by up to 30%. In the case of an average Social Security benefit, this means that you reduce your Social Security benefits to $1,305 monthly or $15,660 annually. Overall, you decrease your total annual income (Social Security plus investment income) to $30,660, or $2,555 per month.

In most cases, you will have to wait until age 67 to collect your full retirement benefit. If you want to retire early, you will have to find a way to replace your income during that seven-year period.

In most cases, $300,000 is not enough to fund early retirement. If you retire at age 60, you will have to live on the $15,000 withdrawals and nothing more. This translates to a monthly income of just $1,250, falling below the $15,650 federal poverty level (FPL) for individuals.

Potential Pitfalls

A woman reviews if she can retire at 60 with $300,000 on her phone.

It may be tempting to dip into your principal, but doing so can shorten the life of your savings.

First, consider the consequences. To match the estimated $37,378 annual budget, you must withdraw $22,378 from your principal in 2025, as well as all of its average returns, so nothing replaces those withdrawals.

Over a seven-year period, this will reduce your retirement account balance and shrink your nest egg’s balance, which will produce less and less income in turn. By the time you begin collecting Social Security, little will be left of your original $300,000.

Therefore, with $300,000 in savings, you’ll likely need to wait until full retirement age to begin collecting Social Security. Collecting Social Security early reduces your benefits for every month before full retirement age. If you begin collecting benefits at age 62 (the earliest you can do so), you cut your lifetime benefits to 70% of full value.

Healthcare Considerations

For someone retiring at 60 with $300,000, one of the biggest challenges is paying for healthcare before Medicare begins at 65. Without employer coverage, it is important to find a plan balancing affordability with adequate protection.

Health Insurance Marketplace Plans. The Health Insurance Marketplace is a federal health insurance marketplace offering plans for retirees who aren’t yet eligible for Medicare. Premiums are based on income, not assets, which can work in your favor if your taxable income is low in retirement. Many early retirees are eligible for significant subsidies that reduce both monthly premiums and out-of-pocket costs. You can compare plans and estimate potential savings at HealthCare.gov.
COBRA Coverage. If you’re leaving a job that provided health insurance, you may be able to keep that coverage temporarily through COBRA. This option allows you to maintain the same benefits for up to 18 months. However, you’ll pay the full premium yourself for both your portion and your employer’s, so it can be expensive. Still, this can serve as a bridge between employment and marketplace coverage.
Health-Sharing Ministries and Short-Term Plans. Some early retirees turn to health-sharing ministries or short-term health insurance to fill coverage gaps. While these options may offer lower monthly costs, they’re not regulated like traditional health insurance and may exclude preexisting conditions or major procedures. They’re best viewed as last-resort, stopgap solutions.
Health Savings Accounts (HSAs). If you already have a health savings account (HSA), it may serve as a valuable tool during these gap years. Contributions made during your working years grow tax-free, and withdrawals for qualified medical expenses also remain tax-free. You can also use HSA funds to pay for health insurance premiums while on COBRA or receiving unemployment benefits. Building an HSA balance before retirement gives you a flexible source of healthcare funding.

Ultimately, bridging the five-year gap before Medicare requires careful planning. Comparing ACA subsidies, exploring COBRA or short-term options and leveraging HSA savings can all help protect both your health, as well as your limited nest egg.

Retirement Expenses: Taxes

You may need to account for income taxes in retirement, depending on how your savings are structured and the amount of income you generate.

Withdrawals from traditional retirement accounts like 401(k)s and IRAs are typically subject to ordinary income tax, while Roth IRA withdrawals are generally tax-free. The government may tax your Social Security benefits, but that is dependent on your total retirement income.

The IRS uses a formula called provisional income to determine if your Social Security benefits are taxable. To calculate it, add half of your annual Social Security benefits to your other income sources, including taxable withdrawals and investment earnings.

If the total exceeds IRS thresholds, you may be responsible for paying tax on part of your benefits. For individuals, benefits may be taxed for provisional income exceeding $25,000, while married couples filing jointly have a threshold of $32,000.

Not all retirees owe taxes on Social Security, especially those with lower overall income or those who rely more heavily on Roth accounts and other tax-free sources. Keep in mind that your may also encounter state Social Security taxes, while others do not.

Personal circumstances, as well as your sources of retirement income, can have a significant impact on your tax liability in retirement.

Retirement Expenses: Annual Cost of Living

With $300,000 and Social Security, you can expect to collect just under $38,000 per year, or $ On a monthly basis, that works out to about $3,167 per month.

Is that enough to live on? It depends on several variables.

Mortgage or rent
Groceries
Utilities
Total taxes, including property, state and federal
Insurance expenses, including auto, life, medical and long-term care coverage

Be sure to also consider discretionary expenses and luxury items, such as travel and vacations. Even more important, keep in mind that these expenses will rise each year due to inflation.

In general, a $38,000 retirement income is not entirely unrealistic. However, much of that depends on where you choose to live. A retirement account like this in Kalamazoo, Michigan will be far more practical than trying to live in Chicago.

Reasons for Optimism

When estimating your lifestyle needs, most experts recommend estimating between 70% to 90% of your pre-retirement income. This is because you’ll have expenses that won’t carry into retirement. You will also have more flexibility if you choose somewhere less expensive to retire.

In the case of a $37,378 retirement income, this estimate puts us around a pre-retirement income of $47,000 per year, assuming an 80% savings rate. If you earned around $50,000 per year before retirement, a $300,000 retirement account and Social Security benefits may allow you to continue enjoying your same lifestyle.

However, while you may require less money than you did while working, be forewarned that retirement costs can still add up.

Bottom Line

For most people, early retirement may not be an option. However, if you’re willing to budget and keep a very close eye on your expenses, it is possible. Just remember that the years between age 60 and when you begin Social Security will be the most challenging.

Tips on Retirement

You can do some learning about retiring on $300,000, but a financial advisor may have more insight into planning for this than you do. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with 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.
It pays to get a good estimate of whether you’re financially ready for retirement. Use SmartAsset’s free retirement calculator to begin.