6 Ways to Get More Money in Retirement

Some of us are blessed with the right combination of foresight, circumstance and high-paying careers so that we never have to worry about our income in retirement. But for the rest of us — 88%, to be exact — that’s a real concern, at least according to a recent survey by investment advisory firm Schroders.

It’s not an unfounded fear, either. As you age, your ability to earn income by working goes down while your healthcare expenses ramp up.

Couple that with a confusing network of tax laws and financial regulations, and planning for retirement often feels like trying to put a puzzle together in the dark. And in a sense, you are, because even the best financial planner can’t plan exactly what’ll happen in the future.

Despite those challenges, there are several strategies you can use to boost your income in retirement — even if you’ve already entered that phase of life. Here’s what to do:

1. Create a financial plan

You wouldn’t start driving to your destination on a road trip without looking at a map first. But that’s the way many Americans approach retirement: More than half of retirees don’t have a plan for their post-retirement income, according to the Schroders survey.

Creating a financial plan — which is essentially a map showing routes that can help you reach your goals — is complex, especially when it comes to planning for all the unknowns that could happen in retirement. That’s why hiring a financial planner can be worth the cost.

“I would advise folks to work with advisors who are transparent, very upfront and make very clear how much they're paying and exactly what it is they're paying for,” says Kevin Lam, a certified financial planner and retirement specialist with Age Wisely Financial.

Many people confuse investment services with financial services. Your investments are just one part of a bigger picture, Lam says. And because many advisors charge based on how much you have invested with them (a model known as “assets under management”), it can be harder to see how much you’re really paying. He suggests knowing how your advisor is paid and whether that might influence the advice they give you.

Lam also recommends reaching out to the Foundation for Financial Planning to get connected with an advisor offering holistic planning services. And if you're worried about affording the advice, know that many of these planners offer services on a pro-bono basis for certain populations.

2. Delay when you file for Social Security

You’ll have more flexibility with your income in retirement if you start thinking about it while you’re still working full-time.

“The decisions you make in your 50s and 60s will impact the flexibility you have in your 70s and 80s,” says Mark Van Drunen, a senior managing director with MAI Capital Management. Case in point: When you first file for Social Security.

“We've seen people say, 'I just wanted money to come in,' and they'll sign up for it at age 62 or 63 because they want a paycheck,” says Van Drunen. You may get a paycheck sooner, but it comes at a big cost. Older adults who file for Social Security before age 70 will receive permanently smaller payments. Depending on how early you start filing, your payments could be reduced by up to 30%.

By delaying when you file, you’ll ensure the highest amount of Social Security income possible for the rest of your life.

3. Consider options for working longer

A recent Prudential study showed that 43% of 65-year-olds are postponing their retirement and working longer, specifically because inflation has been eroding the value of their savings.

First, consider the different options you have for working longer. You can certainly just keep plugging along in your full-time career, and many people do. But you can also opt for part-time employment, possibly in a position you’d love to do but couldn't in the past. If you’ve ever wanted to work in a baseball stadium, for example, but couldn’t swing the lower pay and later evenings with family demands, now’s your golden opportunity. Many older adults also start small businesses, consulting firms or a flexible side hustle like driving for Uber or Lyft.

If you haven’t reached full retirement age — that’s 67 for those born in 1960 or later — then working in retirement can reduce your Social Security benefits, though only if you earn above a certain limit. (In 2024, it’s $22,320, or $59,520 during the year you turn age 67.) On the flip side, once you reach age 50, you’re allowed to save more in official retirement plans, allowing you to pocket more of your earnings for later on.

4. Make strategic money moves

You know the basic principles of managing your money by now, such as keeping your taxes low and letting your savings grow for as long as possible. Those ideas helped you when you were younger, and they’re still broadly applicable.

But now that you’re in retirement, things can get turned on their head more easily when you have new and interlocking factors to consider. Pulling lots of money out of your carefully-tended retirement accounts can seem scary and antithetical to good financial management, for example, but it could be a smart move that frees up cash to put into different vehicles that will serve you better in the long run.

“A lot of people get wrapped around principal and income, meaning, 'listen, I want my principal to stay put, and I just want to receive income,'” says Van Drunen. “And that artificially drives people into higher-yielding instruments, which may actually have higher risk tied to them.”

The problem is, you may not have enough time to recover from a big market swing if you’re invested more in riskier investments. In another example, Van Drunen sees many people who are too focused on keeping their taxes low by not withdrawing from their tax-deferred retirement accounts — until the rules force them to start doing this when they get older, causing them to skyrocket into a higher tax bracket and lose out on income they’ve worked hard for.

It’s hard to offer any blanket advice about how retirees should manage risk exposure in their investment portfolio or minimize taxes, because there are so many variables. But the key is to think beyond the balance in your retirement accounts. You may need to weigh potential changes in your strategy over time to account for taxes, shifting market winds or even just living longer than you expected.

“We educate and train our clients to focus on the total return,” Van Drunen says.

5. Consider downsizing your home

For empty nesters and those with larger homes, it’s a good idea to think about whether downsizing is worth it. But many people are understandably resistant to the idea.

“It’s difficult to detach yourself from all the stuff — but very emotional stuff — that you've accumulated over time,” says Lam. “And just selling a house and figuring out where to move — I mean, that's a lot to go through.”

You can get over some of these hurdles by ripping off the bandaid sooner rather than later. “I think people that moved early are the ones who did the best,” says Van Drunen. “If you do it early, you will land well. If you wait till you're 80, 85, it's way too late because it's very hard to make decisions. It's harder to part with items.”

If you’re in a position where it’s a good fit, downsizing to a smaller home can benefit your retirement income in many ways:

• Immediate income from any home sale profits
• Less spending on utilities, property taxes, insurance, etc.
• Lower maintenance requirements, particularly as you age
• Moving to a lower-cost-of-living area where your income stretches further

It’s hard to overstate the importance of streamlining your home maintenance tasks, particularly as you age and need to hire people to do things you were once able to handle yourself. That’s especially true if you plan to use your home equity to supplement your income in retirement. Keeping your home in good shape is a stipulation from most lenders.

6. Leverage your home

Many retirees tap into their home equity as a source of retirement cash flow. Reverse mortgages, which had a bad rap earlier in the 2000s, now have more robust safeguards that make them more consumer friendly.

A reverse mortgage can be a tremendous help thanks to a unique perk: It’s a loan that you take out against your home equity, but you don’t have to make monthly payments. Instead, the loan comes due after you die, move out, or fail to meet the loan terms like keeping up with property taxes, insurance and home maintenance. When the loan becomes due, many homeowners (or their heirs) choose to sell the house and use the proceeds to repay the lender.

“You could set it up so that you receive the payment for as long as you live, even if your mortgage balance keeps growing,” Lam says. In that way, proceeds from a reverse mortgage could become almost like a secondary Social Security payment that continues as long as you hold up the terms of your loan.

There are other creative ways to use your home and other assets, too. You may want to use a home equity loan or line of credit as a funding source to start a small business, for example, if you’re able to continue making monthly payments. Or some older adults supplement their income by renting out a room or additional dwelling unit (ADU) in their home. Done right, it could open the door for many tax breaks on rental income, to boot.

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