I'm 60, single, and I’m scared I'm going to blow the money in my IRA and ruin my retirement. What should I do to make sure that doesn't happen?

Common mistakes to avoid with your IRA

One of the biggest mistakes to avoid is withdrawing money early. If you take money out of your IRA before the age of 59 ½ — and you don't fall within a limited number of exceptions — you will be charged a 10% penalty on the withdrawn funds.

Furthermore, you'll also miss out on all the gains the invested funds could have made from the time of the withdrawal until the time that you retire, which could be a large amount of money. For example, if you withdraw $5,000 from your IRA at age 50, that money would have turned into $18,500.09 by age 67 — assuming an 8% average annual return on investment (ROI) — if you had left the $5K in the IRA.

On the flip side, once you reach age 73 you must start taking Required Minimum Distributions (RMDs), which are the minimum amounts of money that you have to withdraw from your account every year.

Failure to take out your RMD could lead to a penalty equal to 25% of the amount you should have withdrawn (although this can be reduced to a 10% penalty if the error is corrected within two years). With this in mind, you’re going to want to be sure to comply with the IRS' guidelines for RMDs.

Finally, investing in the wrong assets is also a big error you should try to avoid. This could happen if you throw money at investments with high fees, which can significantly eat into your returns, or if you simply have the wrong mix of assets in your portfolio. For example, if you have too much stock market exposure when you’re nearing retirement and begin making withdrawals from your IRA, you could end up having to sell stock at a bad time and locking in losses.

One tried and true method to calculate the percentage of your portfolio that should be invested in stocks is to follow the Rule of 110, where you simply take 110 and subtract your age. The remainder then represents the percentage of your portfolio that should be invested in stocks. Since you are 60, you’d take 110 and subtract your age — which gives you a value of 50, meaning you should have roughly 50% of your portfolio invested in stocks.

By avoiding these errors, you can make sure your retirement doesn't take a hit that puts you at risk of financial insecurity.

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How to make the most of your IRA

Just as there are mistakes to avoid, there are also moves you can make with your IRA that will increase the chances of you having enough money to see you through retirement.

For one thing, you should try to max out your contributions each year. In 2025, you’re allowed to contribute $7,000 to your IRA if you are 50 or under — older Americans can also make an additional $1,000 catch-up contribution for a total of $8,000. The closer you can get to maxing out your annual contributions, the more money you'll have to grow so you can benefit from compound interest — and the more you'll have to live on as a retiree.

You'll also want to make sure you invest in the right kind of IRA. A traditional IRA allows contributions with pre-tax dollars — which can potentially reduce your tax liability — but withdrawals are subject to tax, and RMD rules apply.

If you invest in a Roth IRA, you won't be able to deduct your contributions, but you also aren't subjected to RMDs and can make tax-free withdrawals. If you think your tax bracket is going to be higher as a retiree, a Roth IRA may be a great option for you.

If you already have a traditional IRA but are concerned about having to take out money when you don't need it — and pay taxes when you do — you may also want to consider a Roth conversion.

A Roth conversion is a taxable event in which you transfer funds from a pre-tax retirement account, such as a traditional IRA, into a Roth IRA. There is, however, a five-year holding period on withdrawals that include money that was part of a Roth conversion — which means you might want to reconsider this option if you are near retirement and are expecting to need the converted money within that five-year time frame.

Finally, regularly rebalancing your portfolio to ensure you have a diverse mix of assets — and an age-appropriate level of exposure to risk — is very important as well. If you aren't sure how to do that, or are debating whether a Roth conversion is right for you, a financial adviser can offer invaluable help in making those choices and ensuring financial stability for your retirement.