A 70-year-old blew through one-third of his $3 million nest egg in 3 years — financial advisors say he needs to act now

The typical retirement account balance among Americans 65 and over is surprisingly low, with an average balance of just $330,186 and a median of $103,202, according to Vanguard (1).

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While the amount you have invested matters, it's not the only number to pay attention to. You must also consider your annual withdrawal rate, or the amount of money you take out of your accounts. If you withdraw money too fast, you won't leave enough invested to keep earning sufficient returns to cover your lifestyle in retirement, and you take a risk of your money running dry. This is true even if you start with a lot.

Let's pretend, for example, that Mark is 70 years old. He retired at 67 with $3 million, but he already spent $1 million of it in his first three years of retirement, and now he's worried about making his cash last.

So, how can Mark ensure that what's left of his nest egg can support him throughout his retirement? Financial experts spoke to Moneywise to provide some advice on what Mark should do next.

The first thing Mark needs to do is to take a hard look at how he spent so much so quickly.

"If someone were to have spent $1,000,000 in the first three years of retirement out of a total $3,000,000 nest egg they had saved, this would ring some alarm bells in the event the expenses were not expected," Clifford Cornell (2), a CFP and financial advisor at Bone Fide Wealth, told Moneywise.

Steve Azoury (3), a ChFC and owner of Azoury Financial, agreed. "It's important to understand what the $1 million was spent on," Azoury said. "If the $1 million was spent on eliminating debt, like paying off homes and cars, then payments on those items wouldn't need to be paid anymore in retirement."

Cornell recommended taking a close look at all the one-off expenses that won't recur to make sure that these were a substantial part of the initial spending. If they weren't, this could be a big problem.

"If this is someone who is just now realizing their spending rate three years in, this can be a serious risk to their retirement," he said.

Retirement is supposed to be about enjoying the freedom you've spent decades working toward — not worrying about whether your savings will run out. But it's easy to underestimate how quickly retirement savings can disappear.

If your nest egg has shrunk faster than you expected, it's worth taking a fresh look at your financial plan.

A financial advisor can help you separate essential expenses from discretionary spending while reviewing whether your investments still match your retirement goals. Those who work with financial advisors typically see 3% higher net returns compared to those who don't, according to research from Envestnet (4).

A financial advisor may recommend shifting your portfolio toward assets with stronger long-term growth potential or adjusting your withdrawal strategy so you're less likely to outlive your savings. That guidance can be particularly valuable for households with more than $250,000 — like Mark's hypothetical example — in retirement savings, where even small portfolio adjustments can have a meaningful impact over the long run.

If you have a portfolio of this size, you can find a reputed FINRA/SEC-registered advisor near you for free through WiserAdvisor .