Some of us have already planted into our minds that we’ll rely on our 401(k) and IRA when we finally reach the age of retirement. Others, meanwhile, have their own businesses to run or grown children to support them. But what are our other options if we hope to have a larger and a more steady stream of income?
Your options depend on your retirement goals and circumstances. For example, you may want to opt for a low-risk investment product now that you’re older, or one that frees you of risks altogether, like an annuity. This could be the most fitting investment for you if you’ve established specific goals in your retirement and see yourself live long enough to attain those goals. When you approach a professional selling annuities, make sure to communicate all your goals to them, so they can provide you with the best type of annuity and an elaborate plan.
That said, here are more ways to keep a steady stream of income after retiring:
Social Security benefits are given to individuals at full retirement age (66-67), but it can be given earlier, if, for example, you retired at age 62, at least. However, you’ll only be receiving 30% less of what you’re supposed to earn if you waited until your full retirement age.
If you don’t take Social Security, your monthly benefit will have the potential to grow by 8% yearly until you turn 70. But this doesn’t mean you should wait to reach this age before receiving Social Security. It would be best to take your benefits as soon as you can, especially if you have important needs to finance. Also take note that if you take on a job during your retirement while you’re younger than the full retirement age, your benefit will possibly be reduced or suspended.
You can receive dividends from stocks, or interest income from bonds after retirement. Real estate is also another profitable investment product, and you don’t even have to buy land or property to earn from it. If you plan to relocate after retiring, you can turn your current home into a rental property and earn a steady income from it.
When you’re already earning from stocks, bonds, or other similar products, always re-invest the income they’ve generated, so that once you retire, your wealth has already been built.
If you’re still perfectly fit to work after the age of 66 to 67, then a part-time post-career work can earn you a good amount of money, too. Work on something you’re passionate about, so that you won’t have to feel like you’re working.
How To Know When You’re Ready to Retire
48% of working Americans fear retiring due to being financially unsecure, but now that you know how to maintain a steady income stream even after retirement, then you’ll be ready once the following starts applying to you:
- You’ve settled all your debts
- Your children and parents no longer rely on you financially
- You’ve already created your retirement plans (budget, goals, etc.)
- Your investment portfolio has been updated
- background-color: transparent; font-variant-numeric: normal; You’ve reached the full retirement age
- Your spouse or partner consents
Those are the signs that you’re ready to retire, so while you’re still young and working, manage your finances well and control your spending, so that you can transition to retirement smoothly when the time comes.