As a part of your retirement planning, have you thought about a retirement job?
Continued income from a post retirement job can have a very substantial positive impact on your retirement finances.
Lets do a fast calculation and see the impact of an after retirement job on your retirement finances. Lets calculate the amount of investment that you need to generate a monthly income of $1,000 per month.
To do this we need to make a few assumptions. Assume the income generation rate of your investments is five percent (5%). Lets assume that we are not going to take any principle from your investments to do this. This will leave the principle intact for use later after you have stopped working in your retirement job.
The calculation is how much principle is needed to generate $12,000 per year ($1,000 per month). The formula is principle divided by the income interest rate ($12,000/.05 = $240,000). I think you will agree that is a large amount necessary to generate $1,000 of income per month.
However, a thousand dollars per month is not too large an amount to expect to make in a retirement job and just look at the impact that it has on preserving your retirement investment.
Three retirement calculators on the Net that include income from work after retirement in the calculations are the AARP Calculator, the Employee Benefit Research Institute Calculator, and the MSN Calculator. The MSN calculator is especially easy to use and is very visual so you can see the results as you change the variables.
These calculators have a weakness since they ask for the amount of annual income from a job after retirement, but they do not ask for the age when that income will stop. They assume the income will continue until death which may not be accurate. We are all living longer, but most of us will not be working at age 90.
These three retirement calculators are the more realistic calculators on the Net. They help us calculate how much money we will need to retire. However, they do not help us manage our retirement funds after we retire.
Once we retire, the variables involved in calculating retirement finances are greatly reduced. Unless Aunt Bess leaves you an unexpected inheritance in her will, you know what your retirement savings are that have to last your lifetime.
Unless inflation runs away during our retirement, the major variables we have to consider are how much we budget to spend each year, the amount we make from our retirement job, and how long we choose to work at that retirement job.
A retirement calculator that will help you plan your after retirement finances can be found at the Retirement Jobs Online website (http://www.retirement-jobs-online.com). This calculator will help you determine how long your retirement savings will last under various different situations.
As part of your retirement plan, you can use the Internet and work from home on your own schedule to generate the income that will extend your retirement savings. Use the calculators mentioned above to see the real impact income from a retirement job can make on your retirement finances.
Thousands of people are using the Internet to make a full time living. Why not use it for retirement work and make some money to boot? This will be a nice supplement to your retirement income from your investments and Social Security. And you can have some fun in the process.
I wish you a great and productive retirement. |
