Retiring With Under $100,000? Here's Why You're Not Doomed

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The median retirement savings balance among Americans aged 65 to 74 is $200,000, according to the Federal Reserve. That's not a ton of money in its own right. But if you're about to retire with less than $100,000 in your IRA or 401(k), you may be freaking out just a bit.

Retiring with less than $100,000 is not optimal. There's really no getting around that. But it also doesn't mean you're totally doomed. Here's why things aren't as bleak as they might seem.

1. You still have Social Security

If you worked all of your life and paid into Social Security, then you should be entitled to monthly benefits once you reach age 62. You don't have to sign up then, and you'll get a higher benefit if you wait longer, but that's the earliest age you qualify.

The average retired worker on Social Security today gets $1,918 a month, or about $23,000 a year. If you earned more during your career than the typical worker, your monthly benefit should be higher. You can also boost that benefit by holding off on claiming Social Security until age 70.

Plus, while there's talk of Social Security having to cut benefits, lawmakers have never let that happen. And this isn't the first time the program has faced a financial crisis, either. So don't assume you won't be able to collect whatever monthly benefit you're entitled to based on your income history.

2. You can work part-time to boost your income

You can wrap up a full-time job and continue to work part-time as a retiree. The Social Security Administration won't stop you. You're allowed to collect benefits while earning money from a job, though there may be income limits to keep in mind depending on your age.

But either way, supplementing your retirement income with part-time work is a smart move not just for the extra money, but the entertainment.

The hard truth about retirement is that it can be boring. It's not easy to transition from a full-time work schedule to a schedule that's completely wide open. You may find that part-time work is not only helpful financially, but fulfilling -- especially if you find a gig you enjoy.

3. You may be able to downsize your way into a larger nest egg

Not every retiree is a homeowner with equity in a house. But if you're retiring with a paid-off home, or one whose mortgage you're close to paying off, then you may be able to use your equity to supplement your savings.

The typical American aged 65 and over has $250,000 in home equity, according to the National Council on Aging. So let's say you own a home mortgage-free worth $400,000. If you sell it and replace it with a $300,000 home, guess what? You've got $100,000 in cash to work with. That means you've just doubled your nest egg.

It's best to retire with more than $100,000 if you can help it. But if that ship has sailed, don't assume you're destined for a terrible retirement. With mindful spending and savvy choices, you can set yourself up to boost your income and stretch your savings.

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