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With the COVID-19 continuing to affect our daily lives more than a year after it began, business shutdowns are affecting investment funds and retirement accounts. Seniors have begun to feel the effect of this as their retirement nest eggs aren’t the assets they’d anticipated, which has led to many leaning more on alternative funds to help pay for retirement. Some of these include heading back into the workforce on a part-time basis, taking out a reverse mortgage, or even finding ways to make money from home.
Full-time retirees become part-time workers
While many businesses like restaurants and gyms have had their doors shuttered during the pandemic, essential businesses have been allowed to remain open to serve the general public. Grocery stores, hardware stores, and others that have been deemed essential businesses have helped to support workers who have had to find other work during this difficult time.
Despite having already retired, some seniors have headed back into the workforce to obtain part-time work in order to supplement their retirement fund. Clocking time as a cashier or door greeter has become been a regular way for seniors to continue to stay active during retirement, but it’s recently become a more common way to supplement a retirement fund.
Reverse mortgage loans
Seniors who have felt the direct effects of the pandemic on their nest egg have found that a reverse mortgage is a good option for supplementing their retirement fund with quick cash. This has been an effective route for some because the housing market has managed to stay steady in many areas.
What is a reverse mortgage?
If you’re unfamiliar with a reverse mortgage, it involves taking out a loan against the equity of your home. Each month, rather than the homeowner making a loan payment to the lender, the lender makes a payment to the homeowner. The homeowner also has the option to take a lump sum of cash to deposit directly into their account or take out an annuity. It’s truly reversed from a traditional mortgage loan.
A reverse mortgage has shown to be beneficial to retirees because it’s another source of monthly income and it’s non-taxable. Furthermore, the loan on a reverse mortgage doesn’t come due until the homeowner dies, moves, or sells the home.
Those who are eligible for a reverse mortgage are individuals over the age of 62 who have established 50% or more equity in their home. To learn more about reverse mortgages, including your eligibility, check out this reverse mortgage calculator here: https://reverse.mortgage/calculator.
Working from home
In contrast to shutting down the business entirely, many businesses have transitioned to working remotely. This means helping employees get set up at home with their computers and holding digital meetings monthly, weekly, or even daily. With an increasing number of remote jobs opening up, seniors have taken advantage of the ability to work from home and found part-time work from the comfort of home as a way to continue to bring in income.
Other seniors have found a way to put their past career knowledge to good use by starting small businesses in consulting and teaching. For instance, online teaching platforms like VIPKID help teachers connect with children around the globe who are learning English as a second language. VIPKID has become one of the leading global teaching platforms in the world and seniors have been able to take advantage of their 100% remote teaching model.
Rather than find part-time work or run a small business from home, others have managed to get creative with turning hobbies into income. With time to work on hobbies like sewing, painting, and woodworking, seniors have taken to selling handcrafted items online with digital marketplaces like Etsy. This has been a boon to both online shoppers and retirees alike as individuals have been able to stay home to both make money and continue to shop.
Positivity on the horizon
With the uncertainty that has come with a global pandemic, bright spots have been few and far between for many. With income shrinking for some and downright disappearing for others, seniors have had to find creative ways to continue to bring in funds to support themselves.
Surveys show that many seniors are optimistic about the rollout of the COVID-19 vaccine and believe it will help to quell the pandemic. As life gets closer to returning to some variety of normal, seniors and their retirement nest eggs will be able to as well.
