The best retirement income plans – ones that maximize Social Security benefits, incorporate a comprehensive tax strategy, and use a bucket strategy – will help minimize the need to continue working. However, even diligent savers may find that, once they have retired, they could use a bit of extra income. Perhaps they want to expand their travel budget or aspire to purchase a new vacation home.
No matter the reason, it’s important to remember that just because you are retired doesn’t mean you can’t continue to earn. There are passive ventures that can generate supplemental income with a small amount of upfront capital, and there are active pursuits that not only generate income but can fill your days with a sense of purpose or structure.
Here are seven ways you can earn extra income to supplement your retirement savings and improve your financial situation:
Investing was likely a key component of your retirement plan. In fact, it’s probably how you amassed enough wealth to retire in the first place. As you transition into and through retirement, it’s a good idea to continue investing.
Your investments can increase the likelihood that you will continue to have a steady income stream even after three or more decades spent in retirement.
If you’re looking to generate income in the nearer future, there are moderate risk investment opportunities, as well as dividend-paying stock options that can boost your expendable income.
Chances are, the expertise and knowledge you gained during your working years are valuable in your industry. You may find there are opportunities to capitalize on that knowledge and experience by providing consulting services. Use the connections you built during your years in the workforce to advertise your services and generate clients.
Plus, when providing consulting services, there’s often plenty of flexibility to be your own boss and set your own hours.
3. Real Estate
If you’ve paid off your mortgage and have cash to spare, then investing in real estate can create the conditions for an ongoing stream of fairly passive income.
The most laissez-faire version of real estate investing involves buying a house or property in an area where property values are on the rise. The investor holds the property for a few years and then sells it for a gain. Of course, this method requires the investor to (a) have enough liquid cash to purchase the property and (b) be able to sustain sufficient cash flow and emergency funds without needing to access the capital tied up in the investment property.
Alternatively, you can invest in a rental property. Ideally, you would be able to cover all or most of the mortgage upfront, and then use the incoming rental payments as a steady stream of ongoing income over the long term.
Additionally, there’s house flipping, but house flipping is often likened to the “day trading” of real estate investment; it can result in big payoffs, but it can just as easily result in big losses. Not to mention how hands-on this practice is: you may find yourself working 40-hour weeks to flip houses profitably.
4. List Your Vacation Home on Airbnb
With Airbnb, you’ll be responsible for your listing. Everything from adding your home to the site, communicating with guests, arranging cleaning services, and responding to property emergencies falls under your umbrella.
Turnkey, on the other hand, takes care of most responsibilities for you. However, the tradeoff is a higher listing fee that can eat into your income.
In retirement, your home can begin to feel empty. Without a job compelling you to leave the house each day and spend time with others, the full effects of your empty nest might be more palpable than ever.
Caring for children in your neighborhood or town can have the dual positive effects of generating a modest amount of extra income and filling your days with youthful energy.
6. Home Cook
If you have a passion for cooking, then consider part-time work as a home cook. Compensation for home cooks can be generous and you can often determine how much or how little you want to work.
Word of mouth is one way to find households that are in need of your services and have been vetted by friends, family, or neighbors. Alternatively, there are websites and apps that match people who love to cook with families and travelers seeking homemade meals, such as Feastly, EatWith, and Cookapp.
Finally, if academics were your strong suit or if you’re retiring from a career as a teacher or professor, then tutoring may be right for you.
Most cities have small, private tutoring companies that you can team up with. Alternatively, there are national/international companies like Kumon, Mathnasium, Eye Level, Sylvan, or Tutor Doctor that may have a location in your city. There’s also the option of working independently, which would entail finding clients, scheduling sessions, and managing bookkeeping.
Retirement Income Planning with Advanced Retirement Strategies
Not having enough income to fund the retirement lifestyle you envision can turn years that should be blissful into years of stress. That is why developing a plan to maximize your savings and create additional retirement income can make a world of difference.
The financial advisors at Advanced Retirement Strategies have decades of combined experience helping clients transition into retirement. Using sound investment strategies, extensive social security knowledge, and calculated tax strategies, Advanced Retirement Strategies provides resources and services to residents of Utah who are eager to make the most of their retirement years.