What to Do When You’ve Retired & Run Out of Money

Retirement can be as exciting as it is nerve-wracking. Finally, after many years of hard work, you can finally relax and spend your days enjoying some well-deserved free time doing what you love. But what if that time outnumbers the money you’ve saved up for this chapter of your life? Or, even more commonly, what if you aren’t ready to slow down yet?

People are living longer than ever, and as wonderful as that is, it puts a bit of stress on your retirement savings. With fewer companies offering retirement savings plans to their employees, future financial planning is falling on the individual. So what are some creative ways you can make sure your financial future is well taken care of?

 

Working in Retirement

Sure, it may not be ideal for some. It may even seem like a failure to those still in the workforce. However, many people continue to work in retirement and enjoy it. Your retirement work life will likely look very different. You could become a consultant offering your services to various clients. Or, you could get into the “gig economy.” Make your own schedule through services such as Uber, Rover or SkipTheDishes. Many retirees are also artisans who earn supplemental income from crafts and art they’re passionate about.

 

Dividend-Paying Stocks

A dividend-paying stock is a stock that offers its investors a steady payout. They then have the opportunity to treat this money as income or to re-invest it into more shares, thus growing the dividend amount. A good dividend-paying stock will be consistent and reliable rather than volatile. It’s a great strategy to get into early on. You can re-invest your dividends into more stock while you’re still in the workforce.

 

Start Planning Early

The earlier you start saving the better. Investing in Registered Retirement Savings Plans (RRSP) at a young age can help you to avoid huge market changes and fluctuations too close to your retirement. Often times, RRSPs involve mutual funds which are subject to market fluctuations. They’re also a balance of stocks and bonds based on your risk tolerance and are better investments for long-term savings.

 

Immediate Annuities

An immediate annuity is a long-term contract purchased from an insurance company that defers your taxes. This contract immediately offers out regular payments in exchange for the original large investment. The nice thing about these payments is that they’re guaranteed to last for life or a specified period of time on the contract. They can also be set up to suit your needs — fixed or variable.

 

Mortgage Investment

Another great option for supplemental income is investing in a Mortgage Pool through a Mortgage Investment Corporation (MIC). This form of alternative investment allows you to invest in real estate and collect the interest from these mortgages. Investing through an MIC means that a professional and experienced company is managing a pool of funds from numerous investors. They then inject those funds into multiple projects to protect investors from default. In addition to this, an MIC has the option of choosing to lend out to reliable contractors and real estate investors only to lessen any risks associated with this form of investment. This supplemental income can be used while still preserving your capital.

Retirement is not meant to be stressful, it is meant to be a time in your life for excitement. These are the years to enjoy the sunsets and sunrises, to watch children and grandchildren grow, to travel the world, or to invest time into passions at home. At Cooper Pacific, we’re passionate about helping retirees enjoy this new chapter by alleviating some of the financial stress of retirement. If an MIC feels like the right solution for you, we’d be happy to discuss the next steps to investing with you. Send us an e-mail, our team member Jordan would love to hear from you.