Delay Retirement

Here is how to get your retirement plan back on track in 2009

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The best way to recoup market losses is to work longer. That gives your retirement accounts time to recover before you begin to draw them down. "Even before the financial crisis, people should have been considering working longer because they are going to live longer," says Alicia Munnell, director of the Center for Retirement Research at Boston College and coauthor of Working Longer: The Solution to the Retirement Income Challenge. "After the financial crisis, you need to work three to five years longer."

A recent AARP survey found that 65 percent of workers ages 45 and over are considering delaying retirement and working longer unless the economy improves significantly. Continuing to work allows you to tuck more cash into your accounts, lets your account accrue returns and work its way up to where it was a year ago, and shortens the length of the retirement you will have to finance. How long will you have to work to recoup market losses? For employees who have worked for 20 to 29 years and leave their 401(k) invested in a mix of stocks and bonds, it will take, on average, one year, nine months of work to resuscitate their 401(k)'s, the Employee Benefit Research Institute calculates. If you pull your nest egg out of stocks, that bumps up the recovery time to two years, one month in the working world, EBRI says.

More New Year's resolutions for retirement:

Put off claiming Social Security

Get your 401(k) match

Avoid early withdrawals

Scrutinize 401(k) fees

Determine your risk tolerance

Rebalance your portfolio

Evaluate your target-date fund

Pay off your mortgage

Get a pension

Downsize

Bump up your contributions

More money-related New Year’s resolutions