Adjusting Your Action
If your action feels wrong and the neck has been properly adjusted, it is time to look at the saddle. Lowering the action may require removing a bit of material from the saddle. Raising it may mean a new saddle or a shim under your existing saddle. If some strings are fine and others are too high or low, you should consider recontouring the top of your saddle. Otherwise, it is simpler and safer to make adjustments to the bottom.
To raise the action, I recommend using a new, properly fitted saddle, preferably made of bone—although many new synthetics are available. It is not always practical to have a new saddle made or to make one yourself. If you can’t get one, I suggest shimming what you have. Hardwood veneers are a good choice and readily available. Veneers are commonly .032-inch thick. They can be sanded if you need a thinner shim or stacked to achieve a taller one. At least half of the saddle should be within the bridge slot or it may tip forward or even break the leading edge of the bridge. Be extra careful if you have an undersaddle pickup. Changing your saddle could affect the string-to-string balance. If you need to lower the height of your saddle, sandpaper attached to a flat surface works well. Simply slide the saddle back and forth across the abrasive, being careful to keep the bottom of the saddle flat. It helps to mark with a pencil how much material you wish to remove and then sand to that mark.
Excerpted from Acoustic Guitar Owner’s Manual