Jan 2, 2024
Americans hoping to retire in 2023 have a lot to deal with. First, there was the pandemic, then a market crash. Now, we’re grappling with rising interest rates and stubborn inflation. It’s more important than ever for retiring Americans to ask themselves, “Do I have enough?”
That answer will vary from person to person, and depend on things like location, lifestyle, retirement plans and more. For instance, a GOBankingRates survey found that if you live in Mississippi, you may just need around $505,000 to retire. Meanwhile, you’d need upwards of $1.2 million to retire in New York state.
Don't miss
- Rich young Americans have lost confidence in the stock market — and are betting on these 3 assets instead. Get in now for strong long-term tailwinds
- Here's how much the average American 60-year-old holds in retirement savings — how does your nest egg compare?
- Are you ready for your first year of retirement? Here are 4 things you might not expect — but definitely need to prepare for
Even these numbers are subject to debate. Vanguard, for example, suggests retirees will need between 75% and 85% of their regular salary for each year of retirement. To meet this goal, they suggest saving anywhere from 12% to 15% of your pay each year. If you’re making $70,000, it would take five years of saving 15% of your salary to earn just one year of your reduced salary for retirement. That’s a lot! Working for 50 years would only earn you 10 years of retirement funds.
Advertisement
Feel like you’re falling behind? Here are some ways to catch up quickly and add a little more savings to your retirement pool, whether you’re already retired or going to be soon.
Must Read
- Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — are you doing the same?
- Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how
- Robert Kiyosaki says this 1 asset will surge 400% in a year and begs investors not to miss this ‘explosion’
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
Start an (easy) side hustle
And pay attention to the “easy” part! If you’re retiring from the work grind, don’t go out and find another job that’s equally as stressful — even if it’s just a few days a week. You want something lucrative, but ultimately a job that will fit in your retirement lifestyle, not bring you back to the feeling of working full time. It’s called retirement for a reason!
One great option is to monetize a hobby, passion, or even your professional expertise. You could turn your woodworking hobby into an online business. Or, if you’re a traveler, you could take photos to sell to online websites like Alamy and Shutterstock. You could even freelance your services from working in health care for decades, for example, and become a consultant.
Any of these routes could leave you with a [profitable side hustle](https://moneywise.com/managing-money/how-to-earn-money/6-side-hustle-ideas-that-you-can-do-from-home, resulting in a steady income source to put directly into your retirement savings.
Invest in the stock market
If you’re looking to retire, you’ve probably already invested in the stock market over the years. However, when you start investing at 30 you can look forward to decades of growth and earnings to put towards retirement. At 70, the situation is quite different.
Now, you don’t want to risk your retirement savings by investing in some scheme, or falling for what someone tells you is going to be “the next big thing.” However, options such as safe individual dividend stocks, index funds, and exchange-traded funds (ETF) can be excellent options.
Meet with your financial adviser to understand how much risk you can afford to take on so you can make an informed investment decision and reach your retirement goal.
Read More: Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it
Rental income
There are a few ways to look at rental income. First, there’s the simple option of renting out a room, or even your home, with a company like Vrbo while you travel during retirement. This can provide a reliable source of income, especially if you’re able to get long-term or consistent rentals.
However, renting a property does include property and rental management. So you’d either have to take on this role, or hire someone to do it instead. If that sounds like too much to take on in your retirement, consider leasing a space for storage instead. Or a parking spot, or even tools. This can create a diversified, steady income that can create more retirement savings quickly.
There are even investment platforms that make it possible to become a landlord to major brands like CVS, Kroger and Walmart — and you’ll even get to collect stable grocery store-anchored income each quarter.
No matter what option you choose, always make sure to discuss it with your financial adviser. They’re there to help, especially as you look forward to making your retirement dreams come true.
You May Also Like
- Turning 50 with $0 saved for retirement? Most people don’t realize they’re actually just entering their prime earning decade. Here are 6 ways to catch up fast
- Inside a $1B real estate fund offering access to thousands of income-producing rental properties — with flexible minimums starting at $10
- Vanguard’s outlook on U.S. stocks is raising alarm bells for retirees. Here’s why and how to protect yourself
- Here are 5 easy ways to own multiple properties like Bezos and Beyoncé. You can start with $10 (and no, you don’t have to manage a single thing)
Amy Legate-Wolfe is an experienced personal finance writer and journalist. She has a Bachelor of Arts in History from the University of Toronto, a Freelance Writing Certificate in Journalism from the University of Toronto Schools, and a Master of Arts in Journalism from Western University. Amy has worked for Huffington Post, CTVNews.ca, CBC, Motley Fool Canada, and Financial Post. She is skilled at analyzing trends and creating content for digital and print platforms. In her free time, Amy enjoys reading and watching British dramas on BritBox. She is a mother and dog-mom to a Wheaten Terrier.
