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Are you starting to get nervous as your age creeps upward that you aren’t as prepared for retirement as you should be? While it may be comforting to know many other Americans are in your same boat, that’s not an excuse to remain stagnant. No matter how behind you may be in saving for your golden years, there’s still time to improve your financial picture if you’re diligent in taking action now.

Surprisingly, people in their 50s who earn between $60,000 and $80,000 a year have a median 401(k) balance of less than $170,000 according to a recent Employee Benefit Research Institute report. That’s approximately two to three times their salaries, far less than the five to seven times generally recommended as a goal for that age. Obviously, many people have much less than that number.

So what are some steps you can take in order to boost your retirement savings if you’re way under par?

1. Downsize or relocate

Are you still pouring a lot of money each month into a high mortgage payment, frequent home repairs and/or property taxes? In order to start saving more, it may be necessary to move to an area with lower living costs, or downsize to a home with a more reasonable mortgage and less upkeep. You may also consider a reverse mortgage, which I outlined in this previous blog.

2. Continue working in retirement

Even if you work part-time or do freelance work for a portion of the year, that extra income will allow you to keep–and therefore grow–more assets in your retirement accounts.

Be careful, though–If you work and claim Social Security benefits at the same time, part or all of your payments could be temporarily withheld. Until you reach full retirement age (between 65 and 67, depending on when you were born), Social Security will subtract money from your retirement check if you exceed a certain amount of earned income for the year.

For the year 2015, the limit on earned income is $15,720 ($1,310 per month). The amount goes up each year. If you are collecting Social Security retirement benefits before full retirement age, your benefits are reduced by $1 for every $2 you earn over the limit. Once you reach full retirement age, there is no limit on the amount of money you may earn and still receive your full Social Security retirement benefit. See my previous blog for more details on this subject.

3. Lower your investment costs

While there’s no promise every dollar you save in investment fees will provide you with an extra dollar in return, research shows funds with low costs, such as index funds and ETFs, have a history of earning more than their higher-fee equivalents.

Talk with a financial professional about how low-cost investment choices could boost your investment earnings in a relatively short period of time.

4. Stay employed for a few extra years

The longer you wait to draw money from your retirement account, the longer that money will last, as well as grow. You will acquire additional savings that may help fill in the gaps, and your money will continue to benefit from investment earnings.

For example, if a 65-year-old worker with an annual salary of $70,000 and retirement savings of $500,000 works three additional years and saves 20% a year, plus earns a 5% net return on both existing and new savings, his nest egg could grow to around $635,000.

Staying on the payroll a few more years can also increase your Social Security benefits by an impressive 25%, which significantly boosts the amount you may receive throughout your lifetime. Click here to access a calculator that can estimate the potential increase in lifetime benefits for various retirement ages.

5. Increase your savings

This may seem like an obvious move, but many people lack the will to actually put their good intentions into action.

Talk to a financial professional about how saving more even late in life can have a significant effect on the size of your retirement fund. For example, if a person with an annual salary of $70,000 and $70,000 in a 401(k) increases his contributions from 10% to 20% from ages 50 to 65, he could increase his nest egg from $320,000 to nearly $500,000.

Bottom line: While I can’t promise you’ll be able to reach your goals and maintain a certain lifestyle in your golden years if you’re late to the retirement savings game, by following the above steps, you have a much greater chance at achieving a more profitable and enjoyable future for you and your family.

Author Ron L. Brown, CFP®

Ron is a CERTIFIED FINANCIAL PLANNER™ and President of R.L. Brown Wealth Management. He specializes in retirement, estate, and business planning for professionals and entrepreneurs. Ron assists his clients with creating a financial plan to ensure they are able to live their ideal lifestyle during retirement and leave a strong legacy for their family. Ron has been featured in The Wall Street Journal, US News, Yahoo Finance, Investopedia, and numerous other high profile financial publications.

More posts by Ron L. Brown, CFP®
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