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Forget what they say about “three’s a crowd.”

After a home default prompted Lisa Lockwood, 52, and her husband, Stan Elliot, 56, to move in with her 84-year-old dad in Tacoma, they find three is good financial company.

It’s not where Lockwood and Elliot expected to find themselves in 2007 after using $200,000 — half of their retirement investment — to buy a new house near Vancouver, Wash.

Then, like now, the two-career couple had a combined $170,000 income, no credit-card debt and a pair of IRAs, and had raised four sons with college degrees and jobs.

But the 2008 housing bust blindsided them.

After “anguishing for several months,” they consulted a real-estate attorney, and learned it could take more than 10 years to recoup their losses, says Elliot.

Their age, she says, “weighed heavily on us. We felt like if we were going to make any additional progress toward retirement, staying in that house was the worst thing we could do.”

So after leaving the house and its payments in 2011 in a strategic default, they relocated to new jobs and moved in with Lockwood’s dad. Elliot is in sales management in Shelton, Mason County, and Lockwood is an office manager.

“When we tell our story to friends, it’s amazing how many people will say, ‘I’m considering the same thing with my mother or father,’ ” says Elliot. Caught between economic setbacks and elderly parents’ needs, he adds, “It’s just a fact of the times.”

Unsure of how to regain the investment loss and get back on track toward retirement, the couple filled out an online survey to participate in a free financial makeover with a member of the Puget Sound Chapter of the Financial Planning Association. They were paired with chapter member Bridget Burgess, a certified financial planner with Redmond-based Strategic Planning Partners, an adviser who has seen similar cases caused by the housing crisis.

Even now, the planner says, many people don’t realized that “purchasing a house is not considered taking care of your retirement.” The upside: The couple’s work with an attorney during the foreclosure process is easing what is typically a seven-year credit pinch.

Besides rebuilding their retirement plan, Burgess wants Lockwood and Elliot “to beef up their ready cash in case of an emergency” — an important move because the foreclosure limits their credit access. Her emergency-fund goal for them: $40,000 over the next several years.

“Their primary focus should be on saving,” Burgess advises. With their “excess cash flow” the couple should set up an automatic savings plan that offers a cash reserve with tiers for “potentially higher investment returns.”

This includes one to two months of:

• Immediately available funds, such as from an interest-bearing checking/savings account.

• Funds easily accessed with potential to earn slightly more, such as money-market funds.

• Funds in investments for a longer time-frame, such as mutual funds that don’t impose access penalties.

Next up, they “should allocate their existing investments in their qualified (tax-deferred retirement) plans to more closely match their risk profile and timeline,” she says.

After measuring their risk tolerance, Burgess found them to be “moderate” investors who want a balance between maximizing returns while minimizing risk, so she suggested shifting some of their money-market investments into a more diversified portfolio.

With proper reallocation, she says, the two can be on track to potentially grow their half-million-dollar IRAs into more than $1.1 million by the time they hope to retire in eight years.

Burgess also recommends Elliot ask his employer about starting a company 401(k) plan “and, when implemented, he should max out his contributions, with company matching, to make his money work even harder.”

Rebalancing their portfolio to “reduce risk and maximize potential for gains and participating in employer-sponsored plans is a critical part of your overall retirement plan,” Burgess says. Reviewing asset allocations at least once a year and consulting with a tax adviser is vital, too.

Her final major piece of advice: Buy insurance.

“Right now they have nothing. But leaving your partner in the lurch is a dangerous scenario,” says Burgess. “I encouraged them to at least get a minimum amount of life insurance, just to have enough in this next 10-year period.”

If available, “the most economical source for life and disability insurance is group coverage through their employers,” she adds.

Though not part of the plan Burgess set up, the couple’s home-share with Lockwood’s father recently changed — and the adviser calls it a “win/win” for all.

After her dad began eyeing a reverse mortgage, Lockwood and Elliot offered to buy the house — and they closed the private deal a few weeks ago with a real-estate attorney.

“We’re all very pleased,” says Elliot. “We got the opportunity to be homeowners again at a low interest rate and a chance to pay off the house in 10 years. (My father-in-law) gets a nice monthly check, as well as the chance to stay in ‘his’ home for as long as he wants.”

The planner calls this a smart move for Lockwood’s father.

“It shows it’s not about your net worth when you retire, it’s about your net income,” Burgess says. “Some people waltz into retirement with huge piles of cash in investments, but they have no idea what kind of income they can generate with that.

“Lockwood’s dad took an asset — his house — and converted into an income-producing vehicle. That’s absolutely ideal.”