It's a retiree's nightmare: outliving the assets in a retirement portfolio.

Between historically low interest rates dragging on fixed-income yields and uncertainties about taxes, not to mention the threat of future inflation and volatile markets that send skittish investors seeking shelter, retirees who are living longer are finding it challenging to keep their portfolios up to speed.

Recent calculations from the Employee Benefit Research Institute show that roughly 44% of those born between 1948 and 1978baby boomers and Generation Xwon't have adequate retirement income, and that is assuming interest rates go back up in 2014. But the current environment is weighing even on those heading into retirement with what seems like a tidy sum.

Retirees need an efficient plan of attack to squeeze all the juice out of their portfolios, ensuring they have sufficient assets for their golden years. Here are some strategies:

Retirees should map out a budget for necessitiesinclude everything from housing to food, transportation, health expenses and utility billsand set aside a chunk of a portfolio for these costs.

Many planners suggest putting funds to cover three to five years' worth of expenses into safe and liquid vehicles, so the retiree has cash on hand, even if the market drops.

"That way you don't have to liquidate in a down environment," says Marty Leclerc, portfolio manager for Barrack Yard Advisors in Bryn Mawr, Pa.

Even though money-market funds are returning basically nothing, funds earmarked to be used within three years should go into these instruments, says Michael Gibney, a financial planner in Riverdale, N.J. "There is no reason to put money that will be used within a short time period at risk," he says.

For five-year time frames, look to add in a short-term bond fund or certificate of deposit to gain a little more yield, he says.

With many people living well into their 90s, retirees need to think carefully about how to protect themselves from running out of money in their later years.

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Making Your Retirement Assets Last