Image by scottwills via Flickr
One of concerns that many people have right now — and with good reason — is how they can stretch their retirement funds. This is a concern, since many have taken a hit to their retirement accounts. And, of course, Social Security is only meant to be a supplement, and can hardly be relied on in any case. This time is a time to evaluate your financial situation, and your retirement goals. It is a time to take stock of what you can do to improve your situation, or at least prevent it from degenerating too far.
There are signs of economic recovery, but that may not be comforting to you when you look at your retirement account statement. You may still feel the need to make efforts to save your retirement. So what can you do if you are looking for stretching the funds in your retirement account? Here are three things to consider in these tough times:
- Consider working longer: If you already have a job, it might be worth it to put off retirement for a little bit longer. If you have recently lost a job, it might be a good idea to see what you can find before you start tapping into your retirement account. This is especially important if you are not 59 1/2, and may have to pay a penalty for early withdrawal, not to mention the tax implications. A part-time job can be helpful as well. If you can find a part-time job that can provide you with income to help reduce your need for tapping into your retirement account.
- Look for other income streams: Your income doesn’t have to come from a traditional full-time or part-time job. You can also cultivate alternative income streams, such as those from a web site or blog or affiliate program. It is also possible to look for investments, such dividend-paying stocks or income from a rental property, to help you create additional revenue streams that can help you reduce your reliance on your retirement account. Realize, though, that setting up these income streams can take a great deal of research and work themselves; it’s not “easy” money.
- Downsize your life: If you want to avoid depleting your retirement account of capital right now, you can stretch your funds by downsizing your life. Do you still need more than one car? Do you need to keep bestowing large gifts on friends and family? Perhaps you could sell your home and get something smaller and less expensive. Do an inventory of your life, and decide whether or not there places where you can cut expenses. The less you spend, the less you will need your retirement account.
Right now, it is no surprise that many are concerned. Even though there have been signs of economic recovery, nothing is certain right now. And it might be some time yet before your retirement account recovers. That means that it is a good idea to have a plan for stretching your retirement funds as far as they can go. If it is possible for you to work a little longer and cut back a bit, you can position yourself for the future. And if you can add some additional income streams, you will be in even better shape.