by Mark P Cussen, CFP, CMFC 
Recent market turbulence has drastically reduced the balances in many IRA and qualified plans, often by as much as 50 percent. The fallout from the subprime mortgage meltdown of 2008 has left a dark cloud covering much of the financial landscape in America and has effectively forced a large percentage of older workers nearing retirement to rethink, re-strategize and reschedule their retirement plans.
But while many of them have resigned themselves to working for another five or even 10 years to make up for the losses that they sustained in 2008 and 2009, a recent study has indicated that the majority of them did not shift their plan assets from their current allocation during the crisis. Whether this was done out of fear, ignorance or deliberation is unclear, but it may indicate an improvement in the level of investment knowledge of the average retirement plan participant.
However, most recent polls, surveys and reports conducted by various retirement plan providers and mutual fund companies reflect a substantial shortfall in retirement savings among workers over 50. Many of those in this category feel that their current IRA and retirement plan balances are less than half of what they need to be in order for them to live the kind of life that they desire after they stop working.
(But perhaps not surprisingly, these same studies also show that virtually none of them have taken much concrete action to get their plans back on track, such as increasing their retirement plan contribution levels.)
Nevertheless, you may be pleasantly surprised to discover that you don't have to put your retirement dreams on hold, as long as you are willing to make a few basic adjustments. Although it still takes $1 million to generate $40,000 of annual income at 4 percent, there are other ways to realize at least a portion of this income without having to stock up on lottery tickets or hope for an inheritance from a rich relative. Instead, take concrete steps to salvage your retirement plan and still be able to enjoy your golden years.
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