5 Strategies to Boost Your Retirement Savings: A Guide for Pre-Retirees

Approaching retirement should be exciting, but what if you don’t have enough saved? Don’t panic – you have options to boost your retirement savings. Here are five strategies to help you catch up on savings and secure the retirement you want:

1. Adjust Your Timeline

Working a few extra years can significantly impact your nest egg. Consider:

Making catch-up contributions during your highest-earning years
Exploring flexible work arrangements—could you reduce your hours, request flex time, or work remotely part of the week?
Boosting your Social Security benefit with the income from those extra years

2. Maximize Savings and Optimize Investments

Review your budget and cut unnecessary expenses
Pursue potential pay raises, job promotions, or working overtime to boost your income and savings
Look at possible side jobs, like driving for Uber, bookkeeping, or tutoring
Maximize catch-up contributions in your retirement accounts. If you’re 50 or older, you can add an extra $1,000 to IRAs (up to $6,500 total) and $6,000 to 401(k)s (up to $24,500 total) annually.
Optimize your investment strategy: Balance potential returns with appropriate risk. Consult a financial advisor experienced in pre-retiree portfolios. They can help your money work for you, maximizing its growth potential.

3. Plan for Retirement Income

Although days of rest and doing nothing in retirement sound ideal while you are working, endless days of inactivity can quickly become monotonous and detrimental to both physical and mental well-being. With that in mind, consider ways to earn money and stay active throughout your retirement:

Start a small business
Monetize a hobby
Work part-time in a role you enjoy
Volunteer for charitable organizations

Tip: Many part-time jobs and volunteer roles offer valuable perks, such as membership discounts, free courses, dining room privileges, and even access to exclusive facilities or events.

4. Adjust Your Retirement Lifestyle

Live well on less by:

Identifying potential expense reductions in retirement. This may include grocery and dining costs, memberships and subscriptions, and reducing your current home, auto, and health insurance rates.
Aligning your spending with current priorities.
Considering downsizing your home or moving to a lower cost-of-living area.
Leveraging your home equity to bolster your investments and savings.

5. Delay Claiming Social Security

Working a part-time job for the first few years of retirement can help you delay claiming Social Security, which could significantly boost the benefit you receive.

Your monthly Social Security benefit can increase by 8% per year if you delay claiming it between your Full Retirement Age (FRA) and age 70. For example, if you wait 4 years after your FRA to start claiming Social Security, your benefit could be about 32% higher than if you started at your FRA.

The Social Security formula calculates your monthly benefit by averaging your 35 highest-earning years, including any years with no earnings. If you don’t have 35 years of earnings due to time spent out of the workforce, even part-time work during those years can help boost your Social Security benefit.

Social Security was never intended to be your only source of income in retirement, but delaying your claim by just two years for a 15% higher benefit could make a significant impact on when you can retire and what you can do during retirement.

Conclusion

Have enough to retire by making the most of your time. Combining these strategies can help you close the gap in your retirement savings. It’s not too late to make up for lost time. Consider working with a financial planner to review your situation and create a tailored action plan to boost your retirement savings and secure your dream retirement.

Disclaimer: The information provided is for informational purposes only and does not constitute financial or legal advice. Finivi Inc. makes no representations regarding the accuracy or completeness of linked third-party content and assumes no responsibility for any outcomes resulting from its use. External links do not imply endorsement. Please consult a professional before making financial decisions.

This information is not intended to be legal or tax advice. The author can provide information, but not advice related to social security benefits. Clients should seek guidance from the Social Security Administration regarding their particular situation. Social Security benefit payout rates can and will change at the sole discretion of the Social Security Administration. Please consult a local Social Security Administration office or visit www.ssa.gov for more information.