Make Your Retirement Dollars Last

According to a recent report, a vast majority of adult Americans — 88 percent — are concerned about how much money they’ll have in retirement. If you count yourself among that 88 percent, there are ways to increase your money during retirement. Here are some ideas to think about.

Make a Plan

Another recent report found that more than half of retirees don’t have a plan for their post-working years income. If you don’t have a plan for retirement income, start now. Here are a few ideas:

• Maximize Retirement Contributions. Try to maximize your contributions to your 401(k) and IRA while you’re still working. If you’re over 50, you can take advantage of catch-up contributions to accelerate your savings.
• Rebalance Your Portfolio. Review your investments to ensure they still align with your retirement goals, risk tolerance, time horizon, and income needs, and adjust accordingly. Consult an investment professional or financial advisor for help.
• Explore Passive Income Opportunities. To save more, look at ways to earn passive income, like starting an online business or investing in dividend-paying stocks. This can supplement your retirement savings and provide some financial flexibility.

The more you know how much you’ll have and how much you’ll need to spend, the better prepared you’ll be for when it comes time to stop working. 

Consider Downsizing

If you have a large home or property, consider downsizing to reduce costs, property taxes, and maintenance expenses. Selling a home can provide a lump sum of cash that can be invested or used to pay for retirement expenses.

Relocate. Moving to an area with a lower cost of living can be another way to stretch your retirement income further, allowing you to maintain your lifestyle without depleting your nest egg.

Develop a Social Security Strategy

You can start taking Social Security as early as 62. There are advantages and disadvantages to delaying payments and they are based on your finances and health situation.

Delaying Payments

• Higher Monthly Payments. The longer you wait, the more money you’ll rake in with your monthly checks. For each year you delay, your payments increase by about 8% annually until you turn 70.
• Lower Risk of Depleting Savings. Taking your Social Security later ensures higher monthly payments which can help reduce the reliance on retirement savings and lower the risk of drawing down your retirement savings and running out of money.

Taking Payments Early

• Income. If you start taking your Social Security payments at 62, you’ve got an immediate source of income to rely on. But the earlier you take your payments, the lower the payments. You could reduce your monthly Social Security check by up to 30 percent if you start taking benefits early.
• Health Considerations. If you or your spouse are not in good health, it may make sense to start payments early instead of delaying payments.
• Lower Financial Stress. If you’re concerned about outliving your money or worried about your retirement savings, taking payments early can help relieve financial stress.

Do One Thing: Develop a Social Security strategy based on your situation, including health, financial needs, and retirement goals. Find a financial advisor who specializes in Social Security retirement planning to you make the right decision for you.