6 Last-Minute Retirement Fixes

Once you make it to your 60s, there's not a lot of time left to build wealth for retirement. But you do have some options to quickly and significantly improve your retirement finances. Here's how to boost your cash flow in the years leading up to retirement.

Downsize. Retirees no longer need several bedrooms that have to be cleaned and a large yard that must be maintained. Moving into a more compact and less expensive home could reduce your ongoing monthly expenses and perhaps add a significant amount of cash to your nest egg. "Particularly for people living in coastal California, reducing their housing cost by downsizing can have a really big impact," says Catherine Hawley, a certified financial planner in Monterey, California. "There's going to be closing costs associated with selling a house, and there might be tax implications, but it's definitely something to examine and consider. It can also sometimes be an emotional decision because that's your home and community."

[See: 10 Places to Retire on a Social Security Budget.]

Reverse mortgage. If you are intent on staying in your current home for the rest of your life but don't have enough retirement income to cover all your monthly bills, a reverse mortgage can be used to fill the gap. This type of home loan is available to people age 62 and older and only needs to be repaid if you sell the home, move or die. "In certain situations a reverse mortgage is worth consideration, particularly if someone gets dangerously low on their retirement savings and wants or really needs to stay where they are," says David McPherson, a certified financial planner and founder of Four Ponds Financial Planning in Bourne, Massachusetts. "But you should proceed carefully and pay attention to the potential downsides." Reverse mortgages charge a variety of fees, and you typically won't be able to leave the home to your children unless they repay the loan.

Delay Social Security. Your age when you sign up for Social Security makes a big difference in your monthly benefit. Payments are reduced if you claim them before your full retirement age, which is typically age 66 or 67 depending on your birth year, and increase for each month of delay between your full retirement age and 70. "If you want to retire after 70, that option will allow you to work longer, save more and even give you the ability to postpone Social Security until age 70, which means you will get more income from Social Security," says Arthur Flores, a certified financial planner for Flores Wealth Planning in New York. "You can go to the Social Security website and get your statement and find out how much you get at 62 and if you wait until 70 how much more you are going to get."

[See: 10 Ways to Increase Your Social Security Payments.]

Cut fees. When you retire you have the option to roll over your retirement savings from a 401(k) to an IRA. If your 401(k) has appealing low-cost funds, you can typically leave the money in your workplace retirement account. However, if your 401(k) plan has a poor investment selection, retirement provides an opportunity to move your money to funds with significantly lower costs. "If there's a transition where there's an opportunity to roll over a 401(k) that has funds that are not all that appealing because of high fees, depending on the size of the 401(k), it could lead to thousands of dollars of savings," Hawley says. "Reducing the fees on investments can take a bit of research to start out, but then once it's in place it's not something where you have to be constantly making a decision on a regular basis." Paying smaller fees over two or three decades of retirement means more of your savings and investment returns will be available for spending.

Minimize taxes. Income tax will be due on each withdrawal you take from traditional 401(k)s and IRAs, and distributions are required after age 70 1/2. However, there are several ways to minimize the tax bite, especially if you start planning in your 50s and 60s. "It may be a good idea to diversify your tax expense and maybe have part of your retirement savings in a traditional 401(k) or IRA and the other part in a Roth 401(k) or Roth IRA," Flores says. "With a Roth 401(k) or IRA you pay taxes on that today, and then tomorrow you don't have to pay taxes on that in retirement."

[See: How to Reduce Your Tax Bill by Saving for Retirement.]

A part-time job. Working an extra year or taking on a new part-time job can allow you to reduce or delay your retirement account withdrawals and gives your existing savings more time to grow. "If you are willing to consider part-time employment in the early years of retirement, that can make a big difference in allowing someone to stretch out their retirement savings," McPherson says. "Even someone who earns $15,000 a year for the first three years of retirement, that's $45,000 that they don't have to pull out of their savings."

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Emily Brandon is the author of "Pensionless: The 10-Step Solution for a Stress-Free Retirement."