Retirees who may be looking for additional sources of cash beyond Social Security benefit payments would do well to try and explore non-traditional sources of cash flow, instead of simply relying on a single source. One such source that can help to make a senior more resilient in retirement is a reverse mortgage, according to Deanna Ritchie, financial editor at online financial platform Due’s guide blog.
“It’s not all doom and gloom, though. An astounding 72% of respondents of one survey claim that the pandemic hasn’t changed their retirement plans,” she writes. “Regardless if the pandemic has impacted your retirement or not, the fact is you never know when you’ll have a financial setback. The good news? If you prepare yourself now, you’ll be able to bounce back seamlessly.”
Richie goes on to offer several financial tips that can help someone who may be struggling with stress associated with insufficient retirement savings, including revisiting retirement contributions and investment allocations; focusing on activities that can help replenish savings; appropriately defining what constitutes a “financial emergency;” and delaying retirement by choosing to work longer.
One tip centers on the idea of being “flexible and resourceful,” which is where non-traditional cash flow sources come into play. One of those potential possibilities that is often overlooked is a reverse mortgage, she says.
“You may not be able to catch up on lost time if you’ve fallen terribly behind with your retirement planning,” she says. “Therefore, you should be prepared to examine other means of securing your retirement. To start, consider finding additional income sources other than Social Security and your savings. For example, if you’re a homeowner, you could take out a reverse mortgage or rent a spare room on Airbnb. Or, you could sell your home and move into something that’s smaller and less expensive.”
That resilience could also mean finding a part-time job to supplement a fixed income, she says, with websites including RetiredBrains and RetirementJobs.com serving as potential sources specifically catered to finding jobs for older workers.
Resilience could also mean identifying that your current living situation might be unsustainable, and could be better suited to a location where the cost of real estate and general living is lower. This is not a tenable option for many seniors attached to their homes, but may fall into the broad category of being “resilient” enough to make a major change.
Read the column at Due.com.