Finding income opportunities in retirement


People are living longer, and these days 70 is often said to be the new 50. In fact, the 2017 U.S. Trust Insights on Wealth & Worth report[1] says that old age now starts at 73. This makes the typical retirement age of 60 seem arbitrary and problematic. Instead of expecting to live another 15 or 16 years in retirement, the number of years is now close to double that.

To have the best chance of a comfortable retirement, you need to work for as long as possible. When you are at (or near) what is typically the end of your working years, between the age of 50 and 60, you don’t want to forgo a few years’ salary (or a decade’s worth) if it can be prevented in any way.

"When a person leaves the workplace, they lose a monthly salary cheque, a reason to get up, structure to your day, a social circle and, in some cases, status," says retirement coach Lynda Smith. A solution is to find a way to use your skills after retirement.

Consulting and part-time work

There is a growing trend towards semi-retirement, where people adjust their schedule to work part-time – perhaps two, three or four days a week. Obviously, this would adjust down over time, but the flexibility it gives while still earning an income is difficult to say no to. In fact, 20% of the respondents aged 60 and up in a 2017 survey never expect to retire.

Look out for freelance or seasonal work opportunities. Freelance options are numerous, and can use skills learnt in a previous career – such as the editing of academic journals or accountancy assistance or tutoring school subjects. Seasonal work can include tour guide opportunities and other tourism-related jobs. Mandatory retirement ages make prolonging work difficult, but consulting provides a way to continue working in a sector you know beyond the official retirement age. Your experience, built up over three to four decades of work, is a phenomenal asset that you should leverage.

Sharing economy

The so-called sharing economy offers fantastic prospects for income that simply didn't exist a decade ago. Airbnb, which lets people rent out spare bedrooms or cottages, is a straightforward and safe way for someone in retirement to make extra money without starting an entire bed and breakfast operation. A service like Uber, which lets anyone with a smartphone and a car (of certain spec) become a taxi driver, also has obvious appeal. You may think that these ideas sound great for someone living in the US or Europe, but there are an increasing number of examples of retirees turning to these kinds of services here in South Africa.

Local services

You also have the option to help those around you. You could work with animals (take dogs for walks), housesit, babysit, or run errands, all because you have the luxury of time (something those younger than you don’t have). Advertise your services in your community both online (for example, on Facebook) and offline. You’ll be surprised at how well word-of-mouth works.

Hobbies can also help you earn extra income, and because of the increased amount of time you have, this can be meaningful. Perhaps you didn’t have enough time to spend on gardening or cooking or carpentry or sewing or art before - now you do!

Becoming an entrepreneur at age 60 is not the silver bullet than many believe it to be. There are endless stories of pensioners sinking millions into franchises or businesses that hardly last five years. If you do want to go this route, make sure to manage your risk incredibly carefully and don’t invest money in a business that you can’t afford to lose.

Saving money

Generating extra income takes care of one-half of the equation. The other - watching what you spend - is just as important.

There are three good habits to build:

  1. Always shop around for the best possible deal. This is not confined to tasks such as grocery shopping – you'll be surprised at the discounts you'll be given if you ask for them. Your investments and things like bank accounts fall into this category too. Keep an eye on all costs.
  2. Pensioner discounts are commonplace - make an effort to find out what is offered where and use them! This could be something small like a free coffee with a meal or something more substantial such as 5% off a grocery bill at your local supermarket on a particular day of the week.
  3. Finally, maximise rewards programmes. Most banks and insurers have these. Familiarise yourself with them and make sure you're earning as much as you can, without the programme costing you in other ways (perhaps forcing you to shop somewhere you ordinarily wouldn't). Maximise your use of a programme such as Discovery Vitality's HealthyFood benefit, which offers cash back of up to 25% on items like fruit, vegetables and lean proteins at Pick n Pay or Woolworths. Rewards on fuel spend is something often overlooked, but the sheer cost of filling up a tank these days, means the reward (whether as cash back or as points) can be huge. Remember to check the product terms and conditions on your rewards programmes so that you are able to maximise your benefits.



This article is meant only as information and should not be taken as financial advice. For tailored financial advice, please contact your financial adviser. Discovery Life Investment Services Pty (Ltd), branded as Discovery Invest, is an authorised financial services provider. Registration number 2007/005969/07.

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