For some, retirement marks the end of working life. But for at least 30% of federal retirees, retirement is simply a transition from one form of employment to another. Retirees are rejoining the workforce for a variety of reasons. Many people want or need to continue earning money beyond their retirement annuity. Working on a more casual basis brings other benefits as well, including social interaction and the opportunity to keep learning new things. The following are five ways to work and earn money as a federal retiree.
Go Back To Work Full-Time
If you’re planning for retirement but you’re not ready to stop working, you can get a new full-time job. Often, federal retirees find themselves in high demand because of their skills, experience, and work ethic. If you get a job in the private sector, your new salary will simply add to your existing income. If you take another job with the federal government as a rehired annuitant, however, your salary may be reduced by the amount of the annuity you receive. Some federal retirees continue working in a government organization and preserve their annuity by working as or for a private contractor.
Start A Consulting Business
For many retirees, owning a business is a lifelong dream. Starting a limited liability corporation (LLC) or certain other types of businesses can be a lucrative opportunity in retirement. Perhaps the most obvious type of business for a retiree is a consultancy. Becoming a private consultant allows you to put your acquired skills to work on your own terms. Business-to-business consulting, in particular, tends to pay well since a business client can likely write off your fees at tax time. A retired accountant, for example, can consult with other small business owners and assist them with taxes and other financial matters.
Turn A Hobby Into A Business
Many retirees enjoy the challenge of starting a business based on a hobby or passion. An artisan, for example, might start an Etsy shop selling handmade wares such as quilts, paintings, or pottery. A person who enjoys the reward of teaching and mentorship might start a tutoring business or become a life coach. An animal lover might start a pet-sitting business. A yoga practitioner can become a teacher and open a studio. There are many ways to put personal interests to work in retirement.
Join The Gig Economy
For those who want to limit their working hours while still earning some extra cash, the gig economy has a lot to offer. For example, retirees who drive for services like Uber and Doordash can choose their hours and work only as much as they want to. These days, there are many types of gigs to choose from. Some of the most popular examples of gig work include delivering groceries, doing handyman tasks for neighbors, walking dogs, providing caregiving services, and doing online surveys for points and rewards.
Rent Your Property
You don’t have to own a second home to make money from renting. A lot of retirees can improve their finances by renting a spare bedroom, or renting their home on weekends when they are out of town. If you have extra space in your attic, basement, or garage, you can store other people’s belongings for money. You can also rent your car or bicycle, and you can even make money by renting power tools and appliances that you aren’t using.
Many retirees dream of moving abroad once they’re no longer tied down to an office. If you are planning to live abroad during retirement, you may also be able to work abroad. Retirees who move to beaches in Mexico and South America often find jobs in the tourist industry, where their English skills are prized. Teaching English as a foreign language is another potential second career for retirees in non-English-speaking countries. Another way to work while living abroad is to work virtually. As long as you have a reliable internet connection and the right skill set, you can work from anywhere in the world.
These are a few of the best ways to earn money in retirement, but there are many options to consider. If you’re looking for a post-retirement job, it’s important to figure out how the combination of your pension and earned income impact your tax liabilities to assess how well it fits into your financial plan. It’s also a good idea to update your plan regularly because your needs and desires after retirement will continue to change and evolve.
At Walker Capital Preservation Group, we provide comprehensive retirement planning for federal retirees. We work with our clients to create their ideal retirement, focusing on financial independence and personal goals.