Rammed earth rural residential buildings (RERRBs) in severe cold climates usually have high energy consumption. The three-step retrofit approach of thermal insulation materials, additional sunspaces and phase change materials (PCMs) was innovatively proposed to retrofit a typical RERRB in severe cold regions of China into a nearly zero energy rural residential building (NZERRB). The three economy parameters of the incremental benefit, payback period and cost performance ratio of each case were analyzed and compared. The external insulation measures of two extruded polystyrene boards (XPS) with different thicknesses were added according to the U-value limitations of the Technical Standard for Nearly Zero Energy Buildings in China. The south sunspaces with three types of windows and four depths were attached, and PCM boards of six design cases in the south wall were investigated. Case P-Ⅰ used XPS envelope insulation (thickness is 290 mm on the outer wall, 270 mm on the roof, and 190 mm on the floor) according to the lower U-value standard. Case P-Ⅰ(T-0.9) added the sunspace of 0.9 m depth and triple-pane glazing windows based on Case P-Ⅰ. Case P-Ⅰ(T-0.9)-PCM-Ⅱ(28 °C) inserted 50 mm PCM board on the inner side of the outer insulation of the south wall based on Case P-Ⅰ(T-0.9). The results indicate that Case P-Ⅰ(T-0.9)-PCM-Ⅱ(28 °C) had the best energy-saving effect and economy, which was the optimal retrofit case to realize NZERRB and saved 92.17% of energy. It showed that insulation retrofit is the most effective energy-saving and cost-effective, followed by additional sunspace and PCM. The research can provide reference methods and ways for passive energy-saving retrofit projects for NZERRBs.