Stretching your Pension after Retirement
THERE ARE many people who, after they have retired, find that their financial position is not as rosy as they thought. Inadequate saving while employed, high inflation and escalating healthcare costs all eat away at the buying power of retirement savings. As one gets older, the options to fix this situation become progressively harder. Solutions arise in three categories; Stretching your skills, Stretching your money and finally stretching your relationships.
Stretching Skills
For many different reasons, the official retirement age is being extended all around the globe with many regarding retirement as the point at which one starts living off accumulated capital rather than the point at which one stops working.
So, an alternative way of securing a more comfortable future is to defer retirement or continue using your accumulated skills to earn a living. Usually the rules to follow are:
· Try to keep to the same field or preferably stay in the same job in which you worked before you retired.
· Don't try to launch your own business unless you ran an identical business before.
· Make use of your contacts.
· Contact companies that you've worked at before.
· Don't have any fancy pay or status objectives.
· Be prepared, presentable and self-confident when you go job hunting.
· Have copies of resumes of your experience and qualifications.
· Tackle head-on any questions about your health.
Stretching Money
Reducing your expenses is normally more difficult than increasing or maintaining your income, but it is surprising how few people;
· take the trouble to find the cheapest places to buy food even though in retirement they have more time to shop around.
· Consider car sharing to go shopping or other outings.
· Properly research all the “pensioner “offerings available
· If you don't own your own home, investigate the possibilities of cheaper accommodation.
· Investigate migrating to a fixed pension when the time is right.
Often pensioners continue to worry about tax on, say, interest income long after they move into the non-taxpaying income brackets.
Sassa grants are available, even though you have a fully paid home, and your possible entitlement to an old age grant should be fully explored.
Stretching Relationships
No one starts life expecting that they may “become a burden” on their children or other relatives. The truth is however that it many be cheaper in the long run that a relatively well off child pays your medical aid rather than face the massive cost of an unfunded medical emergency. These contributions to fund the pensioners life needs can be contractually described as loans so that on the death of the parent the child who funded them is compensated with a repayment of the loan.
Opportunities exist when adult grandchildren leave home that a parent can move in to fill the gap by selling their house and using the funds to pay welcome rent to their own children. Finally in the right circumstances it may be possible for a child to buy the family home from their parents and pay for it through properly structured monthly instalments that the parents can use to supply retirement cashflow. In addition, if the parent is insurable, life cover could be considered to compensate that child for his assistance during the parent’s lifetime