Retirees need to budget carefully to stay within their fixed income. If the value of their investments sinks after retirement, seniors often have little choice but to spend less or return to the workforce. But there are plenty of ways to make a little of extra cash without having to deal with an alarm clock and a commute. Here are a few creative ways to boost your retirement income.
Sell your stuff. Retirees have a lifetime's worth of accumulated clothes, books, and furniture. Make some quick cash by holding a garage sale or selling your stuff on eBay or Craigslist. Take clothes to a consignment shop and a box of books to your nearest used book store. Downsizing from two cars to one can also give your monthly budget a significant one-time boost. Savvy sellers can purchase underpriced used goods and resell them at a higher rate.
Market your skills. Whether you know how to hem and alter clothing, research family genealogy, or troubleshoot computers, someone in your neighborhood is likely to pay for your skills. Put an ad in your local newspaper, hang a flier on a community bulletin board, or offer your services online.
Get a higher interest rate. As you age, you'll want to keep a significant amount of your savings outside of the stock market. Shop around for the best interest rate on certificates of deposit, bonds, and savings accounts. Consider an online saving account, which will likely offer a higher interest rate than the brick-and-mortar variety.
Prune your investments. Review your investment portfolio and get rid of funds that consistently perform poorly. Also, "identify investments that have high expenses and transfer that money into a comparable investment that has lower management fees and expenses," says Eric Tyson, a financial planner and coauthor of Personal Finance For Seniors For Dummies.
Maximize Social Security. The age you sign up for Social Security can make a big difference in the size of your checks. For Americans born in 1943 or later, Social Security payments increase by 8 percent for each year you delay claiming between ages 62 and 70. "If you have good health, you will generally be better not taking the benefits early," says Tyson. "If you have a health problem or have some reason to believe you won't have a long life expectancy, that might be a reason to take Social Security a little bit earlier." Retirees who have already claimed their benefits still have an opportunity to boost their checks. Seniors who pay back the entire amount received without interest can then reclaim at the higher rate.
Utilize Medicare benefits. Sign up for Medicare Part B at age 65 to avoid a 10 percent premium increase for each year of delayed enrollment. Shop around annually for the most economical Medicare Part D prescription drug plan that meets your medication needs. And take advantage of the new services Medicare will soon begin covering. Beneficiaries will no longer have to pay any out-of-pocket costs for most preventive care, including an annual wellness visit beginning in January 2011.
Get a rewards credit card. You're going to continue to spend on food, clothing, and gas. You might as well get a credit card that pays you 1 to 2 percent cash back on your everyday purchases. "If you look around, you can find a no fee card that gives you some benefit," says Tyson. But he cautions: "A lot of the rewards card sock you with annual fees and get you some other way." Of course, if you carry a credit card balance, the extra cash will be lost.
Consult. Put your lifetime of accumulated experience to work by taking on consulting work. "By the time you are in your 50s, you probably know people from a variety of companies based on where you've been," says Mark Miller, publisher of RetirementRevised.com and author of The Hard Times Guide to Retirement Security: Practical Strategies for Money, Work, and Living. "You can go out and do project-based stuff. It is a way to gain flexibility and set you own schedule and work from a home office."
Tutor. Consider offering to help teach children algebra, a foreign language, test preparation, or even drilling younger students on their multiplication tables. "People continue to spend on their kids," says Tyson. "If there is a service you can provide to parents to help them with their kids, such as tutoring kids, your skills will be in demand." Sports fans may be able to land a gig coaching or refereeing youth games or giving golf lessons. And those with teaching credentials
Babysit. Help harried working parents by offering babysitting services. Or better yet, work out an arrangement to get paid to spend time with your own grandchildren. "When I was working and had young children, I paid my mother to babysit," says Jan Cullinane, coauthor of The New Retirement: The Ultimate Guide to the Rest of Your Life. "The kids couldn't have had a better caregiver and she did the laundry for me as well."
Eldercare. At the other end of the aging spectrum, you can provide nonmedical eldercare services for an older retiree. "You go to someone's house and you help them out with lunch, light housekeeping, and take them to appointments," says Cullinane. "Basically you help keep someone's elderly parent company."
Hobbies and crafts. Turn your hobby or craft into a stream of income. Offer to frame pictures, make scrapbooks, or sell your hand-crocheted doilies online. "If you love making jewelry and can sell it to little boutiques, you can make a little business out of it," says Cullinane.
Rent out your space. Retirees who live in big cities or vacation destinations can rent out rooms to travelers. When you leave town, you can lease out the entire house. If you don't want to share your space, consider renting out your garage or basement as storage space.
Blog. Pick a topic that interests you and start researching and writing posts online. The more hits you generate, the more money you will make if you have advertising on the site. Strive to make enough to pay for your Internet connection.
Temp. Employers reluctant to hire new full-time workers with benefits may increasingly rely on short-term help. Temporary jobs and project assignments can be ideal for seniors who want to bring in some income but also enjoy a significant amount of leisure time. Contact a temp agency about short-term projects, seasonal work, or a job filling in for employees who are on vacation or maternity leave.
Garden. Avid gardeners can sell their excess fruits, vegetables, and flowers to farmer's markets, local garden centers, or even neighbors. Alternatively, you could help others learn to prune their rose bushes or select the ideal plants for a sunny spot. Outdoor lovers who don't mind mowing lawns and weeding are sure to find eager customers.
Errands. Retirees who are handy around the house will never be without extra cash. Other easy errands you could provide include grocery shopping, rides to the airport, and picking up dry cleaning.
Cook. Bake sales aren't just for children's fund raisers. Try selling freshly bakes pies, bread, or cookies at local events. If you're more of a cook than a baker, jams, sauces, and even prepared meals could be easy to sell to busy workers.
Pet sit. Animal lovers should have no problem making a few extra dollars dog walking or grooming. Also consider pet sitting when owners go on vacation or travel for work.
Tour guide. History buffs should look into a post-retirement job as a guide at a local museum or historical monument. A part-time tour guide position will allow you to share your knowledge with others and interact with tourists from throughout the world.
Ask for discounts. Some senior discounts are well publicized, but others are only available to those who ask. One of the best perks of getting older is getting a discount simply because you're willing to admit your age.
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