Retirement is a great time in your life. You’re finally able to stop working full-time, allowing you to put all your time and effort towards your passions. However, if you want to make sure that your retirement is a success, it’s important to make sure that you prepare for it long before the last day you clock out at work.
Hopefully, by the time you’re a retiree, you’ll have enough money to retire in comfort, while still being able to knock some items off your bucket list, or just spend time relaxing. However, many retirees find that once they aren’t working anymore, they miss that steady stream of income, or maybe find that they didn’t quite save as much money as they needed.
Whatever the reason, if you’re a retiree who needs more money, here are five simple tricks to help you make more money while not working anymore.
Get Rid of Investments that See Low Returns
Once you retire, you should review your investment portfolio and strategy with a financial professional, at least annually. Depending on your situation, it could make sense to look at reducing your equity exposure from your portfolio, as you’ll have less time to recover from market downturns.
Every situation is different, but a fun, simple way to figure out how much of your portfolio should be allocated to stocks is to subtract your age from 110. The resulting percentage should be used for stocks. However, it is best to consult with a financial advisor when it comes to your investment portfolio if you haven’t already.
Work With a Financial Professional to Budget
Stick with assistance from a financial professional; they can assist you with your cash flow and a budget and to help you decide how to spend your money efficiently while you enjoy your retirement years.
Some helpful budgeting tips include making sure that you pay off any credit card debt soon after you retire, as interest rates can eat up a lot of your savings. You should also be conscious of spending too much on entertainment too early in your retirement. Even if you have a lot of money saved up, many retirees are surprised by how quickly they can drain their savings account when they don’t have a steady income.
Often people are busy during their working years and procrastinate on retirement budgeting and financial plans. It is never too late to start! The experienced, credentialed team at Trust Point bring insights to a variety of wealth-related issues.
Maximize Your Social Security
There are multiple ways to ensure that you get the most out of your social security benefits, including working for at least 35 years, as well as working until you reach full retirement age and not claiming the benefits until you’re 70. If you retire at 62, which is the earliest you can start receiving Social Security, you’ll lose 30% of the benefits for that year. Most people, depending on when they were born, won’t reach ‘full retirement age’ until 65-68. The longer you wait, the less your Social Security benefits will be reduced.
Find Part-Time Work
While the point of retirement is to not work anymore, many retirees find that part-time work isn’t just a great way to add a little extra money to their bank accounts, but it’s also a great way stay busy while retired. Some people find that once they retire, they aren’t quite sure what to do with the extra time they have.
Getting a part-time job, especially doing something that you’re interested in or passionate about, is not a bad option for any retiree.
Move to a Lower Tax State
We all know that Florida is a popular location for retired people, due to its tax incentives for retirees. However, they aren’t the only state that retirees should consider.
A good barometer for tax-friendly states for retirees is to look at the state and local tax burden as a share of state income. Check out this full list of the top 10 states for retirees.
Reach out to Trust Point for All Your Financial Needs
If you need help with any steps along the way, Trust Point can assist. We can sit down with you and get to know you and your particular situation. We will provide plans that will shed light on your current financial situation and help you best meet your financial goals. Trust Point can help you determine when to retire, how to make smart investment choices with your retirement funds, or simply prepare a cash flow plan so that your retirement spending stays in line with your goals. Our team of certified financial planners can guide you through the crucial conversations that will be essential to set you up for a great retirement.
Contact us today and let us know how we can help!