In a recent Wall Street Journal article, Karen Damato interviewed professional financial planners to discuss the options available to people hoping to retire in ten years who find themselves without a big enough retirement fund.

Many pre-retirees lost money on their investments, while others have simply not saved enough over the years. Those who are homeowners may have the option in the future of increasing their income with a reverse mortgage, but even these pre-retirees should take other steps to improve their retirement plans. Facing up to the reality of a too-small nest egg is step one, which should be quickly followed by taking some of the following advice:

1. Slash your spending. Reducing your expenses can be a two-fold benefit: first, you have more money to save and invest for your retirement years. Second, your income needs will be lower in your retirement years if you learn to live on less money now.
2. Plan to work longer. If you are already eager to quit work, you may have to rededicate yourself to the idea of a longer career than you thought. Try to find ways to make changes to your job so you like it more or, better yet, you can increase your salary and save more.
3. Evaluate your investment mix. Individuals with a shorter timeframe before retirement may be tempted to take on high risk investments to boost their portfolio, but financial experts warn that this could be dangerous and result in a loss. Playing it too conservative can also be a problem, so the experts recommend a balanced portfolio.
4. Investigate reverse mortgage options. Consider the potential monthly income, line of credit or lump sum available from the equity in your home as part of your retirement portfolio. A reverse mortgage, available to homeowners age 62 and older, allows you to live off some of the equity without selling your home.

Financial planners would love for every consumer to open a retirement fund with their first paycheck, but for the many individuals who are closer to retiring, there are still options that can provide a strong financial future.

Michele Lerner

Michele Lerner is a freelance writer with twenty years of experience writing articles and web content for newspapers and magazines on topics related to real estate, personal finance and business. Her clients include The Washington Times, Urban Land Magazine, NAREIT's Real Estate Portfolio, and numerous Realtor association publications. Michele's first book, "HOMEBUYING: Tough Times, First Time, Any Time" is available now at Amazon.com or from www.MicheleLerner.com.

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