How to boost retirement savings, based on your age

While younger Americans may be forcing their parents to tap their retirement savings for financial support, new research shows they should not follow their parents’ retirement savings strategy.

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In a recent report titled “Reimagining Retirement: Generational Strategies for 21st Century Challenges” researchers from the Wells Fargo Investment Institute detailed how retirement strategies should differ among generations of American workers, from millennials through baby boomers.

One common thread? Forty percent of people say they will need to work longer or lower their cost of living to meet retirement expenses. Overall, however, a majority of people expressed confidence about having enough money in retirement.

Here’s a look at some of the other ways Americans of all ages can boost their savings:

Baby Boomers

Delay Social Security: A recent study found that the average retiree claimed Social Security benefits at the age of 62 – which lowers their lifetime income stream. Researchers instead recommend that those who have not yet claimed, delay until age 70 in order to maximize benefits. Full retirement age is 66 for those born before 1959, and 67 for those born after 1960.

It could also help to delay taking retirement account distributions. Required minimum distributions begin at age 70.5.

Move: It’s an often pointed to pattern that retirees flee to Florida, a state with no income tax. But moving to a location with a lower income tax rate and/or cost of living can help people manage retirement expenses. Retirees may also want to consider consulting a professional about their tax obligations, after the onset of the new tax changes.

Get a job: Older Americans can consider part- or full-time employment to supplement their retirement income. As previously reported by FOX Business, a majority of Americans are likely to continue having to work throughout their retirement.

By 2026, the Wells Fargo Investment Institute expects 21.8 percent of individuals 65 and older will have a job.

Generation X

Take advantage of match plans/catch-up contributions: If your company offers a match in a 401(k) or 403(b) plan and you are not taking advantage of it, that is one thing to consider changing.

Additionally, after the age of 50, people are able to make “catch-up” contributions to IRA and 401(k) accounts, which allow eligible individuals to stash extra money away in these accounts. Information from the IRS can be found here.

Retirees should also avoid borrowing from retirement accounts to meet expenses.

Invest for growth: Researchers recommend favoring equities for growth, but being prepared for a downturn by remaining diversified. They also recommend holding between six to 18 months of living expenses in cash.

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Millennials

Start saving: All experts recommend starting to save for retirement as early as possible. Millennials should also take advantage of employer-matched plans, and remember to look into keeping that account when switching employers.

Wells Fargo Investment Institute researchers also recommend considering putting assets in a Roth 401(k), which is funded with after-tax dollars – ideal for people who will be in a higher tax bracket when they plan to withdraw.

Student loans: Don’t delay saving for retirement until after you have paid off your student loans.

Investing: Younger workers should consider taking more risks with their asset allocations, while also remaining diversified.