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NEW YORK (MainStreet) -- For Americans looking to add some much-needed income to their retirement savings once they leave the workforce, boundaries - geographical and otherwise - arent all that necessary.
Take Carol Merchasin, an author and former law firm partner with Morgan, Lewis and Bochius in Philadelphia, whos now living with her husband in San Miguel de Allende, Mexico.
My husband and I boosted our retirement income by leveraging what we did before we retired into less stressful and more part time employment that doesnt require being in an office or even in a particular place, Merchasin says. When I left my law firm, I continued doing training but only as an independent contractor, often doing webcasts from Mexico. Now, ten years later, at almost 70 years old, I still do webcasts and I develop and audit training programs. All from wherever I want to be.
Merchasin also published a book of essays on Mexico called This is Mexico: Tales of Culture and Other Complications and does speaking engagements on Mexican culture from a US expatriate perspective. Her husband, also a lawyer, invested in a small property with three apartments that he now rents out to short term visitors to San Miguel. Our long term strategy has been to support ourselves without touching our nest egg until we were 70, but we are still keeping with that strategy for a few more years, she says. Boosting retirement income for us has meant not taking anything out and allowing it to grow as long as were still able to work comfortably at our own pace.
Financial experts say that Merchasin is on to something, and that, since Americans may not be saving enough for retirement, they should seek extra income while theyre in retirement. Living comfortably in retirement isnt so much about how much money you have, but more importantly what counts is having a solid cash flow plan in place that includes a very clear income and distribution strategy, says Gary Plessl, a certified financial planner who co-authored The Book on Retirement (Richter Publishing, 2015).
The data support their notion that many Americans just wont have enough cash saved up for their after-work years, and will need other avenues toward income once they retire from their full-time careers. Millions of Americans are in danger of not having enough money to maintain their standard of living in retirement, states the Center for American Progress in a new report The Reality of the Retirement Crisis. The problem is getting worse over time.
As of 2013, the median retirement account balance among all households ages 55 to 64 was only $14,500, the CAP reports, and almost one-third of Americans in the workforce havent saved anything for retirement.
If youre in the same leaky boat, and are wondering how you can earn extra income in retirement, Plessl and Houser offer a few key tips to follow.
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Edward Jones Financial Adviser Tom Targonski of Sioux City will host a free presentation titled What Happens After the Paychecks Stop? A Retirement Income Primer.
It will be at 6:30 pm Oct. 28 at 3539 Southern Hills Drive in Sioux City.
Targonski will examine how one can budget for retirement expenses and ones potential sources of retirement income. He will also address some of the potential risks to retirement income.
Refreshments will be served.
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Its hard to accurately quantify what Dyrus has meant not only to Team SoloMid or League of Legends, but eSports in general. He has been one of the best players in the world for so long and inspired so many players. Dyrus impact on eSports will be felt for a long time, which is why its so heartbreaking when he says things like this:
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In a recent radio interview the host asked what the greatest fear facing retirees is today. A quick visit to the World Senior Games reveals the answer to that question. On Wednesday, I had the opportunity to watch my mom and brother both swim in the 100-meter freestyle events. Their races occurred one after the other, giving me a great perspective on our modern definition of retirement. My brother, barely approaching 60, yet retired from full-time work, swam a race against others his age that was as competitive as I had seen when my own boys swam for the high school swim team.
This group, on the dawn of their retirement years, had trained rigorously all year with no less enthusiasm and effort than an athlete 45 years younger. I couldn't help but think that these athletes were just a couple of years away from qualifying for Social Security, a system put in place to provide "hope and protection to some of the most vulnerable members of society." These "retired" swimmers clearly did not fit that description.
The next race combined athletes from ages 80 to 95. Their times were slower and their bodies showed the affects of 30 years of additional aging, but their determination and athletic spirit was firmly intact. As I contrasted these two groups, standing side by side at the pool's edge, I realized once again the answer to the radio host's question. The greatest fear facing today's retirees is the fear of outliving their money.
The miracles of modern health and medicine have resulted in once vulnerable 60 year olds now being top shape competitive athletes. It means living into your 90s, once the accomplishment of legends, is now becoming the norm. We have no reason to doubt that in the coming years, the Senior Games will be adding many events for a growing group of centenarians.
The Senior Games are a reminder of the vast change that has happened over the last 50 years with retirement. Once viewed as a time when life starts to wind down, retirement today is a vibrant time filled with activity and years of adventure. As evidenced by the Senior Games, retirement is no longer a time to prepare to die, but rather a time to rediscover living.
A friend recently retired in his early sixties and asked if I thought he should wind down his accounts to much more conservative positions. My response was that someone in his family needed to keep working to pay for the next forty years and if it wasn't going to be him, then it had better be his money.
As I looked at the image of my retired brother, standing next to my retired mother (both wearing their silver medals), I was reminded that retirement has changed forever and if retirees want to be able to enjoy it to the very end, they will need to maintain an investment portfolio that is just as energetic and vibrant as they expect their lives to be in this new retirement paradigm.
Dan Wyson, CFP is author of the book "21 Financial Myths" and owner of Wyson Financial. Securities and Advisory services offered through Commonwealth Financial Network, member FINRA/SIPC, a registered investment adviser.
Other columns from Dan Wyson
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Things you should worry about
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Smart financial advisers have an opportunity to help smaller companies see the value in offering a retirement plan, and support them as they navigate the various challenges associated with doing so.
Specifically, small businesses may be more focused on day-to-day operations, and may lack the resources needed to create and maintain a retirement program. They also may encounter other challenges such as costs, determining how to manage fiduciary responsibilities and risk, choosing the right investments, and developing the right expertise to administer and oversee a retirement plan.
Because of these perceived obstacles, small employers may feel as if offering a retirement plan to employees is just too much work. But financial advisers should feel empowered to help employers understand that offering a retirement plan doesnt have to be costly or complicated — in fact, it can provide a great opportunity to attract new employees while increasing productivity and retention.STICKY EMPLOYEES
The numbers speak for themselves. According to the Towers Watson 2013-14 Global Benefit Attitudes Survey, employees who have a retirement plan that meets their needs are five times more likely to be highly engaged than those who dont. They are also more likely to stay with the same company until they retire.
The same survey found that nearly half of respondents (45%) cited their companys retirement/ health care program as an important reason they plan to stay at their firm.
Moreover, having a retirement plan fuels Americans confidence about retiring comfortably — a challenge for many employees. The Employee Benefit Research Institutes 2015 Retirement Confidence Survey revealed a strong relationship between retirement plan participation and an increased confidence in employees ability to retire. Among those with a retirement plan, the percentage of very confident responses increased from 14% in 2013 to 28% in 2015.
Offering a retirement plan can pay off for a business in the long run, but what, specifically, can advisers do to communicate the message now?HOW TO HELP
First, advisers can help small-business owners envision what a retirement plan would look like by sharing their expertise on plan design. The same plan that works for a multinational corporation probably wont work for a small business, so advisers can help business owners identify the type of plan that would be most suitable.
Second, beyond plan type, advisers also can provide education on fee structures, investment options, and how employers can administer and supervise a plan while ensuring compliance.
Third, and perhaps most importantly, advisers can counsel small-business owners on how to develop a strong communications program so employees are well aware of their benefits and know to whom they can turn for help.
By focusing on what matters most to employers — including employee engagement and decreasing turnover — advisers can be at the forefront of helping small businesses offer retirement plans. After all, employers, regardless of size, all want the same thing: a productive workforce and a successful business.
Joe DeSilva is senior vice president and general manager of ADP Retirement Services.