LAST-MINUTE STRATEGIES TO BOOST RETIREMENT INCOME
Options for boosting income upon retirement are limited, but there are a few. 1. Try and make a higher contribution towards your savings: If your disposable income does not allow for this, relook the budget and determine where expenditure can be cut. 2. Consider working longer to continue earning a salary: Working beyond retirement often depends on company rules and the concern around cost to company of keeping such an individual on company benefits. But some companies do allow those who have reached retirement age to continue working, with the individuals themselves rather than the company sometimes carrying the cost of those benefits. 3. Become inventive about bringing in more money: This could mean consulting or finding parttime work. “While you may no longer be employable in the formal sector due to your age, there is a whole new world opening up online where you can use your intellect to provide income,” says Anne CabotAlletzhauser, head of the Alexander Forbes research institute. “Start tapping into these online services that range from dog-walking to editing manuscripts to tutoring to make money. It is low risk, low energy so you can do it at your own pace.” 4. Reduce frivolous spending and consider downscaling your lifestyle: Cutting back on niceto-haves could free up a healthy chunk of cash that could be used to top up the retirement pot. Perhaps this is the perfect time to downscale to a smaller, or less expensive vehicle, or a smaller home, allowing you to save on the higher rates and taxes, electricity, water and maintenance costs of larger homes. 5. Don’t discount higher risk growth assets but be wary of get-rich-quick schemes: “There are no shortcuts. It is especially at this time and in the situation of insufficient retirement funds one should be saying ‘Thank you, but no thank you,’ to get-richquick schemes,” says Karp. Someone offering such a scheme is not going through your financial plan to identify exactly what your needs are or what your risk tolerance is. Financial planning is not a product that you pick off the shelf at a supermarket that might be having a special,” says Karp.
But avoiding the get-rich-quick trap doesn’t necessarily mean avoiding higher-risk growth assets. “Even when approaching retirement, growth assets, which may be more volatile but produce the income that is needed, should not necessarily be avoided. “Volatility in capital can be better tolerated than volatility in income,” says Williams.