Retirement For Low Income Earners
Most experts agree that even the term retirement, should be retired. Retirement for many baby boomers was their life’s goal. If you worked hard for many years, saved enough through retirement funds or through a quality work place pension, your senior years would be taken care of.
However, for Generation X’ers, retirement is not the golden goose that many remember of their parents. Companies in America and around the world have shrunk the legacy job and the commensurate benefits of pensions that went with them. It’s time to rethink your work exit strategy.
For older generations, retirement planning simply referred to what they were going to do on a cushy pension in their golden years. Yet, the reality for many that will be entering retirement age within the next five to 10 years, is that the idea of retirement seems unlikely. With the unknowns of social security and many companies only providing part-time work, how can Americans be comfortable with what their retirement will look like? Many older Gen-Xers will not reap the full benefits of retirement plans and will need to look for alternative income for their golden years – especially low income earners.
This is requiring seniors in Americans to rethink their retirement strategy. This may mean increasing retirement savings substantially at a time in your life when you are working even though it may affect your current lifestyle. You cannot put your head in the sand and believe that things will just work out. Establishing a saving mentality and planning may provide a much better quality of life during your actual retirement and non-working years, later in life.
A Working Retirement
One of the major differences that many seniors are realizing relates to the fact that their funds for retirement will fall short at the typical retirement age of 60 years old. This means that a ‘working retirement’ will be required to boost income and savings during your healthy retirement years. At the age of 60 to 70 years old, many seniors can still offer productivity without health issues. If you retire from your career job, finding a passionate hobby that offers compensation may be the best alternative during these first few years.
You may be able to put your years of working experience to use in work-from-home opportunities or in consultative roles. You may just want a simple service job that offers part time hours yet also gives you the much needed boost in income. In either case if you assess your financial portfolio and it falls short of your needs for retirement, you will need to extend your career working years or boost retirement income with part-time or side work.
Financial Tips for Meeting your Retirement Goals
- Start Scrimping. There is never an easy time to become a scrooge, but if you are ill-prepared for retirement, the time should be now. Cut back on all non-essentials, sell assets, and cut at least 20% from your monthly expenses. Put this 20% into your retirement savings fund. Take advantage of senior discounts!
- Learn Something. If you have 5 or 10 years to full retirement, than you have time to learn a new skill. This skill should be something that you can physically do for the next 10 years and something that you can monetize for income. It could include freelance writing, graphic design, consultation services, clerical or administrative work and many others.
- Stay Active. Being healthy in your senior years will mean less expenses and more potential income.
- Speak to a Community Action Agency to learn about subsidies and benefits you may qualify for to help reduce monthly expenses – things like utility bills, rent, food and medicines.
- Get FREE professional help with your finances through a financial counselor, they can help you put a plan together so you know what to expect in retirement versus guessing and hoping things will be okay.
It is important to assess your ability to retire and try to create some form of nest egg...relying on the government is not a great strategy. If this seems like an impossible task, it isn't, but you have to start somewhere in order to have something for retirement.