If you’re headed into retirement, the last thing you want to worry about is how you’ll continue to make money. Generating income without working can be complicated for older adults, but it’s not impossible. It’s essential to understand your options and be aware of potential scams. Unfortunately, older adults are the main target of financial scams.
Still, you can maintain smart spending in retirement and maximize your finances safely and successfully with the proper planning and strategies.
MoneyGeek.com published a helpful article that included expert insight from Access Wealth advisor Leo Chubinishvili, CFP®.
The full article discusses:
- Creating a steady income
- Managing income streams
- Avoiding common mistakes
- Staying safe from money scams
Leo Chubinishvili, CFP®, was asked, “If an older adult could not save heavily before retirement, what’s the first tip you recommend for earning income in retirement?”
Here’s what he had to say:
Making recommendations for an individual’s financial situation requires a comprehensive understanding of their financial picture, including income, expenses, investments, assets, taxes, estate, and overall financial mindset. If the older adult has not saved enough for retirement, here are some general recommendations:
- Consider working full-time or part-time to increase cash flow and delay savings and retirement funds distributions. Postponing the distributions from investment or retirement funds has the potential to increase over time, resulting in a larger sum available in the future. Additionally, Social Security benefits can be delayed until age 70, leading to a higher monthly social security income.
- Reduce spending where possible.
- Decide on Social Security benefits and the optimal time to start collecting, as starting earlier (age 62 is the earliest) means receiving a smaller monthly benefit.
- Consider generating additional funds through downsizing or relocating to a less expensive, tax-friendly area. Selling a larger home and buying a smaller one can reduce monthly costs while freeing up funds for retirement.
Resources for Income Streams for Aging Adults
Various resources are available for aging adults to begin preparing for retirement as early as possible. No matter what stage of life you’re in, the following resources are an excellent place to further your knowledge on potential income streams and how to get started today.
- AARP Retirement Calculator: Answer questions about your household status, salary, retirement savings, and other income, and the AARP calculator can provide insight into whether you’re saving enough money for retirement.
- Social Security Benefits Calculator: The Social Security Association provides this page with various tools and calculators to help determine government benefits you may receive when you retire.
- American Retirement Association: This nonprofit organization was created to educate retirement plan and benefits professionals and create a framework that allows working Americans to retire comfortably. On the site, you’ll find professionals, advocacy, and a variety of connections for retirement education and support.
- PensionHelp.org: A website from the Pension Rights Center, PensionHelp.org connects individuals with counseling projects, government agencies, and legal service providers that offer free information and assistance in pension planning.
- Center for Retirement Research at Boston College: A variety of research and information regarding retirement income. The CCR has been recognized by the New York Times as the nation’s leading center on retirement studies.
- National Council on Aging: On this site, you’ll find resources, tools, best practices, and advocacy for aging with health and financial security.
- Internal Revenue Service — Tax Information for Seniors & Retirees: A free tax-filing tool including an Interactive Tax Assistant. This tool includes information for older adults, including deducting medical expenses, tax scams, finding a tax-aid volunteer, and special rules.
- National Older Worker Career Center: Connects older adults, age 55+, with part-time and full-time career opportunities.
- SeniorLiving.org: A comprehensive website dedicated to helping adults with all aspects of aging. This is a one-stop shop for aging adults, from money management and retirement resources to health, living, and technology.
The fear of outliving one’s money in retirement can be terrifying. Comprehensive financial planning can help ensure that doesn’t happen.
Contact us if you’d like to speak with a wealth advisor who specializes in helping individuals nearing retirement and already retired to be financially independent.