By Ettienne Bezuidenhout, certified financial planner at Alexander Forbes
For most people, their biggest concern around retirement is not having enough money and how they will keep themselves occupied.
Traditional wisdom says we should all save more and invest wisely. But, for those in retirement, or about to go on pension, can you do more with what you have and maybe reduce costs?
Travel in retirement
Most of us dream about travelling in our retirement years – and achieving this goal does not have to be exclusively for the wealthy. There are ways to fund retirement travel, such as renting out, or listing your property on Airbnb while travelling. The income can at least partially pay the travel cost. If you are planning to travel for a number of years, you could sell your property, especially if you are looking to downscale in future.
You could also move to a different province or rural area, or move in with family to save on living costs. If you enjoy camping, buy a caravan, tour the country, and benefit from the low rates campsites offer to long-term campers. Some people spend many years doing this.
New income streams
Approach retirement in a phased manner by doing consulting or mentorship work, but decreasing the hours spent on work. Try to find part-time or seasonal work in a field which matches your interests, or turn your hobby into an income stream.
Rent a portion of your property, through a platform such as Airbnb. Covid-19 has meant that while people can work from home, not everyone has the desired space, so look at creating office space on your property and renting it out. The benefit of this would be additional income, with privacy after hours.
Those who live in large family homes have the option of selling up and using the money to buy two smaller townhouses or apartments, living in one, and renting out the other for extra income.
Finding work in retirement could prove difficult, so some retirees either start a new business or buy an existing one. This can prove risky if you need to invest money up front, and if it does not work out you may end up in an even worse financial position. Preferably start something that needs time, and not money, like joining an estate agency.
Decrease your expenses
If you’re only using your vehicle sporadically, consider selling it, and using a ride hailing app or public transport to get around.
Make purchases online, especially where free delivery is offered. This has the added benefit of shopping less than when in store, as one does not get tempted by adverts and specials.
By selling your property and using the money to rent a place, you can save on maintenance costs, rates and taxes. However, rental could increase and moves to another property could be costly if the lease is not renewed.
Keep busy without overspending
Retirement is when you finally have time to spend on your hobbies, whether it is cooking, baking, painting, cycling or golf. Also, take advantage of South Africa’s climate and beautiful natural splendour, and visit the beach or go for a hike in a safe space.
A successful retirement means a change to the traditional mindset; be adaptable and look for opportunities in creating income, saving costs and keeping busy.