The Senior List recently ran a blog featuring an infographic on retirement savings in America, depicting some eye-opening statistics about average participation rates around the country. On a related topic, another piece written for this site earlier in the year also noted that, according to the latest Ipsos/USA Today poll, 1 in 3 people plan to work during retirement.
Reading these in tandem got us thinking: what practical advice is out there for pulling in a secondary income after you’ve given up full-time work?
A quick Google reveals that there are dozens of websites, blogs and suggestion columns listing many of the most obvious ways to generate money in your own time. A couple of the better ones even allow you to narrow down the huge range of options based on how much time you’d like to put in and where you’d like to be based. The vast majority, though, are a bit one-size-fits-all.
Aside from just listing potential sources of freelance or passive income – the usual suspects being consulting, e-commerce, or arts and crafts – they tend to gloss over the fact that not everyone will suit all options equally well. In many ways, identifying which of your personal interests, skills, goods or hobbies you could potentially monetize is the easy part; it’s figuring out how to approach the task as a lone wolf that’s a bit trickier.
Your own boss…and employee
Essentially, staring a business in retirement is not a significantly dissimilar process to that of launching a startup at any other stage in life. For most current/future retirees of the boomer generation and later, the web has of course proved itself a great leveller in terms of equality of opportunity.
With a decent internet connection and a bit of elbow grease, you’ve just as much chance of making something work from your sitting room at aged 70 as you’d have as a 30-something working out of Silicon Valley. However, one additional thing that all retiree entrepreneurs have, and should look to take maximum advantage of, is a whole career’s worth of experience with the most crucial factor in any secondary income scheme: you.
Always remember this going in – nobody has a better understanding of what roles you’re most suited to than you. You know exactly what aspects of work you’re naturally gifted at, and what things you find more challenging (even if you always managed to cover up the latter in previous roles!).
So, in trying to figure out what the best plan of action is for a secondary income, use that privileged knowledge to your advantage. As your own boss in retirement, it’s important to pick a strategy that plays to your interests and your strengths, and that you’ll be genuinely enthused about putting into action.
Think of this planning time as being much like any other interview, only in this case you’re on both sides of the desk. It’s vitally important to be honest at it, because – and this is easy to forget – you’re going to be your own employee too.
Use your CV to quiz yourself on what aspects of previous roles you’ve especially liked or disliked, and what you found most or least fun about specific workplaces. Can you recall a time you enjoyed taking on a specific extra area responsibility? How might your former colleagues describe you in ten words or fewer?
What contacts did you make who might be in a position to advise or assist you now, away from the corporate constraints of whatever context you met them in the first time around? What you would’ve liked to change about the way you had to approach previous jobs and contacts?
All of this valuable self-reflection is likely to help you make a much more informed decision about what sorts of plans might bear fruit for you in retirement. Ultimately, this is your time, and it’s important to spend it rewardingly and productively.
If it doesn’t feel inherently rewarding, it’s unlikely to translate into a reliable source of income when there’s nobody else cracking a whip over your head.
Be clear about your goals
In the planning stages, be mindful of the fact that doing a job reluctantly under your own steam takes a whole lot more motivation than doing it reluctantly for a paycheck from someone else: more, if we’re honest, than most of us have.
Sheer grinding repetition may have made you a whizz at accounting, customer service or lion-taming over the years – but if, deep down, you can’t muster an ounce of enthusiasm for going back to that, then it’s simply not going to work as your retirement gig.
For that reason, aiming solely at generating a source of secondary income often isn’t sufficient for powering any sort of retirement business for very long. As a general motivator, it’s absolutely a great start; in most cases, though, there’s going to have to be a little more to it than that.
When narrowing down your options, think more expansively about your goals, and try to pick a business model that hits a few more buttons than simply swelling the retirement fund a little.
Are you most keen to learn a new skill, or keep an existing one sharp? Do you want to meet new people, or are you looking forward to focusing exclusively on you and the people closest to you for a change? Will you be looking to funnel as many hours as possible into the new venture, or are you hoping it’ll fit around those long weekends in the RV?
The key point is, there are no right or wrong answers to any of the above questions. The answers themselves though, if they’re honest ones, will be invaluable in helping steer you towards a plan that you’re likely to find sustainable.
Once you’ve gained a clearer understanding of how you’d like to work in retirement, then you’ll be in a much better position to go about picking out exactly what it is you’d like to do.