Knowing that you should save for retirement and actually doing it are two different things. If you never got around to building a nest egg, you run the risk of going broke in retirement. That could be a problem if you have a lot of unpaid debt and financial obligations. But luckily, there are ways to stay afloat when you run out of savings. Here are three ways to cope when you come up short.
1. Use Your Home as a Source of Income
If you own a home, there are several ways to use it to supplement your retirement income. For example, you could sell your house, downsize into a smaller home and use your proceeds to expand your retirement savings. Or you could save money by moving in with a family member.
You could also consider renting out your home. Then you could move somewhere else and use the rental income to cover your housing costs. If you’re not prepared to leave your home, you could still make money by renting out a room on Airbnb.
Another idea involves leveraging the equity you’ve built in your home and getting a reverse mortgage. You’ll have money coming in on a regular basis. But your mortgage will eventually have to be paid off.
2. Tap Into Your Life Insurance Policy
Life insurance can cover the cost of any final expenses and lingering debts after you pass away. But it can also come in handy if you run out of savings in retirement. If you have an insurance policy that builds cash value, you can use that money to pay for bills and other expenses.