More than half of Americans are not on track in their retirement savings, according to a new assessment survey by Fidelity Investments.
A whopping 55% of those surveyed will likely not have enough money to cover their essential living expenses in retirement, including housing, health care, and food, the survey found. What's more, the research indicates that the average working American is on track to cover just 74% of their estimated expenses in retirement.
Fidelity recommends several actions that Americans can take regardless of income levels to accelerate their retirement savings. While some are more obvious — save more, retire later, and make sure your asset allocation is appropriate for your age — a few strategies are not as well known. Here are three surprising ways to boost your retirement readiness:
Wait until age 70 to take Social Security.While the average expected retirement age is 65 to 67, according to Fidelity, waiting to collect Social Security payments will help maximize your monthly benefit, increasing the income by 30%.
Use your home equity to your advantage. Downsizing your home and reinvesting the proceeds can provide an income source you hadn't considered. Fidelity says converting 25% of your estimated home equity into investable assets for retirement significantly improves retirement readiness.
Reallocate part of your savings into an annuity. Consider a fixed lifetime income annuity at or before retirement as another guaranteed income source. You typically won't have access to the principal used to purchase it, but it helps ensure that essential expenses are covered throughout retirement.
SEE ALSO: Millennials May Not Be Able To Retire Until Age 73