5 Steps to Consider if You Can’t Afford to Retire

Many baby boomers are approaching retirement, but that doesn’t mean they are financially prepared.

“There is no doubt there’s a retirement crisis,” says Christopher McIntire, president of McIntire Retirement Services. “People have not saved enough.”

Social Security can help boomers make ends meet during their golden years, but for many, it won’t be enough. According to McIntire, in 2014 the average Social Security check will be $1,294 a month for a single person and $2,111 for a couple.

The retirement savings game has changed over the last few decades as government or company-sponsored pensions disappear and workers become responsible for saving on their own. The 2008 financial crisis was also brutal for many boomers’ portfolios, and despite Wall Street’s recent strength, many haven't been able to fully recover their nest eggs.

While it may seem scary to face retirement with little to no savings, especially since the life expectancy for healthy Americans is well into our 80s, there are options depending on your financial situation.

Experts share five tips boomers should consider to help shore up their finances heading into retirement:

Tip 1: Delay Retirement

For millions of American’s, the dream is to retire early and pursue their hobbies. But if leaving the workforce means you don’t have enough to cover a round of golf, let alone pay the mortgage, you may want to put your retirement dreams on hold.

“Make sure you hit full retirement age before you start collecting Social Security,” says David Hefty, chief executive of Hefty Wealth Partners. If you take retirement early, you will likely end up getting less benefits each month than if you waited to your full retirement age and longer. “You may have 30 years without a paycheck and if you claim too early, you’re locking in a payment that may not keep up with rising inflation over the years,” adds Brad Zucker, president of Safe Money Advisors.

Tip 2: Look for a Part-Time Job

Not only will a part-time job offer a nice cash-infusion, but it can also keep you more active and involved. Financial planners say the retail sector likes to hire retirees because they typically don’t need health insurance or a 401(k) and they are dependable.

“Seniors are ideal workers for that part of the economy,” says Hefty, but he warns the competition could get stiff. “The service sector isn’t large enough to absorb all baby boomers, but for a lot of them, it will be a good job to have.”

Tip 3: Consider a Reverse Mortgage

Many boomers enter retirement with a major asset: their home. If your home is paid off or there’s equity in the home, McIntire suggests looking into a reserve mortgage to create a regular stream of income.

But this option isn’t for everyone.

But a reverse mortgage isn’t going to make sense for everyone, so it’s important to consider the ramifications before going this route. “You have to be 62 or older and it may not always be the best choice,” he says. “But at least it is a choice people have.”

Tip 4: Change Your Lifestyle

If you are heading into retirement without a lot of savings, it’s time to change your lifestyle and retirement outlook and find ways to cut back.

“If you drove a full-size pickup truck, downgrade to a smaller car” Hefty recommends to help save on gas and insurance.

Downsizing to a smaller home can bring substantial savings along with cutting back on your entertainment spending.

“Requiring less retirement income by either living on less or continuing to work after retirement can help solve the problem,” says Zucker.

Tip 5: Become Roomates With Your Adult Children

The protracted recession and housing meltdown had many adult children moving back home with mom and dad, and it might be time for them to return the favor.

Now that the job market is opening up and the economy is improving, adult children may be in a better financial situation to help out their parents. While many parents hadn’t planned to live with their children in retirement, McIntire says it could turn out to be a great way to defray some of the costs for both retirees and the children.