You’ll “earn” a lot of money by spending the time to plan for financial security in retirement.
Many older workers who are approaching their retirement years face a significant challenge—funding a potentially long retirement with modest retirement savings. To do so, they’ll need to squeeze the most retirement income possible from their Social Security benefits and their savings. As a result, retirees often express an interest in looking for work that will help them make ends meet in retirement.
If this sounds like you, then would you be interested in a “retirement job” with the potential to pay you hundreds or even thousands of dollars per hour? No, this is not a pitch for a pyramid scheme! It’s a legitimate endeavor.
What I’m suggesting is that you put in some research “work” that will help you make smart decisions so you’ll be financially secure and healthy for the 20 to 30 years you’ll most like be retired. If you make them wisely, these decisions can help improve your financial security by hundreds of thousands of dollars.
Let’s take a look at a three different “retirement jobs” that have this potential.
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A Social Security bridge payment strategy packs a large potential payoff
One of your most important “retirement jobs” is to decide when to start your Social Security benefits. For many people, the smartest choice is to put off starting your benefits until at least your full retirement age and even waiting until age 70 (but no longer). In order to do that, you can use a portion of your retirement savings to help you delay starting your benefits. This is otherwise known as a “Social Security bridge strategy.” By taking this route, you have the potential to increase the annual income you receive from Social Security by $500 to $1,000 per month. Multiply those amounts by the 25 years you might spend in retirement, and you could boost the amount of the Social Security benefits you receive over your lifetime by $150,000 to $300,000.
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For the sake of argument, let’s suppose you spend 100 hours learning about your potential Social Security claiming strategies (though this is most likely much more time than you’d need to spend on this task). Dividing 100 hours into the potential payouts described previously results in an hourly earning rate of $1,500 to $3,000. Not bad for two and a half weeks of work!
Boost your retirement income generators
Another important “retirement job” involves deciding how best to deploy your savings to generate a lifetime retirement income. Surveys show that retirees tend to fall into two camps when it comes to this task:
- One camp is very concerned about outliving their savings, so they’re quite frugal when making withdrawals from their savings. They’re worried about that proverbial “rainy day” and don’t want to end up broke.
- The second camp is oblivious to the risk of outliving their money, and they spend their savings at an unsustainable rate.
A carefully developed retirement income strategy can help you find the middle ground between these two camps. With the right strategy, the first camp can spend more money and still feel like they won’t outlive their savings, while the second camp will need to pull back a bit and spend their money more wisely. Once again, the potential lifetime payoff could be hundreds of thousands of dollars, depending on how much savings you might have.
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One important part of this particular “retirement job” is to decide how to invest your savings during retirement. As an example, let’s take a look at a married couple with $400,000 in savings (you’ll find more details about that fictitious couple in the post below). It’s not unreasonable to assume that this couple could boost the lifetime payout from their retirement savings by as much as $100,000. If they spent 100 hours developing their strategy, which again is likely more time than they’ll need, they’d be “paying” themselves $1,000 per hour.
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Make smart choices for medical insurance and Medicare
Here’s a final “retirement job” with the potential to result in substantial savings: spending time analyzing your medical insurance and the type of Medicare coverage you elect. These elections will heavily influence how much money you spend on premiums, deductibles, and copayments over your lifetime. In addition, your medical insurance and Medicare help keep you healthy, so that’s another reason to choose wisely.
Ideally, you’d do your research before choosing the type of medical insurance and Medicare coverage you take when you’re eligible at age 65. Then you’d review your health insurance policies every year during Medicare’s Open Enrollment, which runs from October 15 to December 7. You might spend five to 10 hours each year on this task, with the potential to save yourself thousands of dollars if you incur substantial medical costs. Given that, you’d be “paying” yourself hundreds of dollars per every hour you spend on this task.
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Nobody said that it would be easy to be financially secure during the few decades you’ll be retired. But by putting in the work and taking on these three “jobs,” you’ll find that it’s time well spent.