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Retirement Savings Letting You Down? 3 Ways to Scrounge Up More Income

By Maurie Backman – Jan 8, 2022 at 8:36AM

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Your nest egg may not provide as much income as expected. Here's how to cope.

A lot of people enter retirement thinking they're just fine in the savings department, only to end up disappointed. And that's a harsh reality to face once you've actually made your workforce exit.

It's easy enough to look at a large 401(k) or IRA balance and think, "Great, I'm all set," only to realize after the fact that that money has to last somewhere in the ballpark of 20 to 30 years. And so a $500,000 nest egg might seem more than adequate -- until you run the numbers and realize that if you stick to a 4% annual withdrawal rate, you're left with just $20,000 of income.

But fear not -- if you've entered retirement and your nest egg is a letdown, there are other steps you can take to eke out more income. Here are a few worth exploring.

Two people at a table with serious expressions holding documents.

Image source: Getty Images.

1. Delay your Social Security filing

Some people claim Social Security as soon as they retire. But if you've left the workforce and haven't yet filed for benefits, you may want to hold off, work a part-time job to scrounge up some cash for a year or so, and then sign up at a later point.

You're entitled to your complete Social Security benefit based on your personal wage history upon reaching full retirement age, which is either 66, 67, or somewhere in between, depending on when you were born. For each year you delay your filing past full retirement age up until age 70, your monthly benefit gets an 8% boost -- for life. And so if you're able to hold off on submitting your benefits application, you can make up for a nest egg that's failing you.

2. Keep working

We just talked about working for a short while during retirement to make it possible to delay Social Security. But if you're willing to work for as long as you're able to, even if for just a few hours a week, it could boost your income in a meaningful way.

Of course, as a retiree, you may only have so much energy for things like commuting and running around a busy retail store or office. But your job doesn't have to look like that.

These days, there's plenty of part-time work that can be done from home, from data entry to writing to telemarketing. Think about what you have the appetite for and consider holding down a job as long as you can. Not only will the extra income help, but that job will also give you a way to stay occupied without having to spend money.

3. Use your home to your advantage

Whether your home is paid off in time for retirement or not, chances are, you have a fair amount of equity in it. This especially holds true in today's housing market, what with home values being up across the board.

If your nest egg isn't providing as much income as you though it would, you can compensate by selling your home and buying a smaller one that's less expensive. Or, you can stay in your home if that's what you prefer, but look into renting out a portion of it.

Don't want to share your living space with a tenant on a permanent basis? That's understandable. If so, think about renting out your home at times when you're away. If you're anywhere near a beach, popular theme park, or ski resort, you may have a lot of success listing your home as a short-term rental.

You may have done your best to set money aside in a retirement plan year after year. But if the amount of savings you have at your disposal isn't enough, delaying Social Security, working part-time, and downsizing or renting out your home could help make up for that fact and help you shore up your finances during your senior years.

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