Extra Income Ideas for Those Thinking about Retirement

Extra Income Ideas for Those Thinking about Retirement

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Being an average Mr. and Mrs. Smith today, means that we both work, set money aside towards retirement, and hope for the best. Yet most people start a family, pay a mortgage, have living expenses, and education costs—there is often very little extra to put aside for retirement.

If you had to evaluate your life now and guess what your circumstances might be by the time you need to retire, ask yourself if your retirement savings will be enough. Any financial advisor typically asks you to put away at least 10 percent of your gross monthly income into a retirement plan.

Yet, when you do the sums it becomes more and more worrisome as it doesn’t seem enough if you take one simple factor into consideration, which is increased life expectancy. If we are expected to live longer, then that means we must save more.

If we can’t afford it, we need to think of other ways to supplement our retirement so that it will be enough. The question is, how do you find those additional revenue streams and which investment avenues can we consider?


Investing in Possibilities by Spreading Your Risk

In the past it was easy to argue that investing in a bank was a sound choice, especially if you grew up in the Western Hemisphere. It was either that or starting up your own business. Thing is, life was a lot slower, more predictable, and we were blessed with a baby boomer generation that ensured that a tax base was always growing.

It was also coupled with a higher degree of success to provide better opportunities to the younger generation than that which was available to the one before.

With technology impacting every facet of human life, this was bound to change. Today, more people are alive than have ever lived in recorded human history. The pace of change is so fast that the smartphone you buy now is considered old before your twenty-four-month contract is even up!

This constant change at an ever-increasing speed necessitates a rethink about the way we invest and plan for the future. By investing in various things gives you the option to earn higher yields because your risk is spread, creating more long-term success.


Consider an Alternative Way of Thinking about Life

Traditionally, we would work a nine-to-five job, raise our families, and retire at roughly sixty-five years of age. That is how most of the Western world has operated for the last one hundred years or so. Yet, if you think about it carefully, this wasn’t always the modus operandi.

People tended to carve a life for themselves that they lived for as long as their health and circumstances allowed. Retirement is a new term. Our ancestors relied on the younger generation to take care of them when they couldn’t do the things they used to.

This is also why so many parts of the world still have multiple family homes as a set standard when city developers plan for the future. The family unit was designed to ensure continuity for all generations. Perhaps consider how you and your family plan to live when your children grow up. It sounds old fashioned, but circumstances might require us to think old school.


Turning a Hobby into an Income?

People have hobbies because it ignites a passion and they love doing it. Here are some simple ideas that hopefully gets you thinking about earning extra money on the side and having fun:

  • Painting. Sell your artwork online or at a local flea market. You never know how this might turn out. Even if it fails, it’s not like you wasted you time.
  • Travel. Since you love traveling, why not write for travel magazines as a freelancer or do a video vlog. Platforms like YouTube and Facebook allow you to monetize if you manage to create a sensible platform with a large enough following.
  • Photography. If you have an eye for photography, why not consider having a small studio in your garage or that bachelor pad in your backyard that is full of junk. Do the odd wedding as well on a weekend. You will be surprised to see how this can add quite a bundle in the long term.

You might end up changing careers when you near retirement age, and you will find yourself loving what you do. Now it will be about working because you love to do something and not because you have to earn.


Alternatives to Invest In

The Stock Markets

The Stock Markets. This is a tried and tested long-term investment strategy that works. Just make sure you do your homework and never get caught up in the hype. If you do your research, you will see that long-term strategies with buying shares tend to be the best ones.

Nothing is stopping you to do some speculative share trading, but don’t do it with all your savings. Discipline and restraint are key preconditions here.

Fin24 did a nice analysis confirming that nothing is for certain. Write down your goals and put it somewhere prominent so that you can remind yourself when temptation hits.


Own Your Property and Consider Getting a Second One to Rent Out

Few people take the time to consider this, yet it’s one of the most tried and tested investment assets since the beginning of time. Property is an immovable asset and the value of it will almost always go up in the long run.

No matter where you are in the world, you must pay for accommodation. Why not consider paying a bond rather than rent. At least you know that when the twenty or thirty-year mortgage is paid up, that property will always be yours. Best of all, even if you had to move you can always sell it and buy something else. Better yet, you can rent it out if you really love the area.

Don’t forget, the cost of living will always go up and so will your rent. A mortgage repayment might fluctuate with interest rate increases, but it still pays to pay off your own debt as opposed to someone else’s. There will be a lot more disposable money left for you to enjoy the day you retire and you don’t have to pay rent.

Also consider a second property. Renting out that property will not get you the return you want right away, but you might find that you can break even or get close to it. As years go by, you will find that it will start generating a real profit. Yes, you will pay taxes on the profit, but the property is an immovable asset that is worth something and it generates and income for you that will always go up.


Peer-to-Peer (P2P) Lending

The best investment is one that gives a healthy return fast. Nothing can be closer to the truth when looking at P2P lending. Since 2008 when the world economic crisis dried up traditional capital sources, P2P lending was born.

Now anyone with capital can decide who they want to lend it to, and at what rate. This is also efficiently mediated by a P2P platform that ensures that terms are set and each party is protected. Anything from new cars to weddings can be financed this way.

If you use P2P lending, see it as an additional revenue stream and not just as the sole means to save for your old age. Also consider viewing it as a way to keep earning well into your retirement. If you play your cards right, you might end up using P2P lending as your ticket to an early retirement and it will not require an unusual amount of time to keep track of it.

As with share trading discussed earlier, always spread the risk and do your homework. It’s a good idea to start small, research the P2P platforms, and then branch out. According to Global P2P network a lack of research is often the cause for falling into some of the pitfalls when investing to retire early.

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