Make the Most of Your Retirement
By: Angela Stringfellow
Whether youíre newly retired or have been enjoying the good life for awhile now, you may be feeling the pinch of the rising cost of living. You may have made the decision to retire early to take advantage of an early retirement incentive program, such as fixed healthcare costs. Many corporations and even some government agencies have recently offered programs like this, in an effort to get more staff to retire early, rather than be forced to lay off employees. These incentive programs have an added advantage for businesses because potential retirees typically have higher salaries than the entry-level workers that would be replacing them, if anyone would be hired to replace them at all, given the current economic state.
In any case, itís likely that when you retired, your income became much more fixed than it used to be. Youíre probably not looking forward to annual raises the way you used to, and with energy and food costs inflating at the highest rate in decades, many retirees are wondering if they are going to continue to be able to make ends meet, particularly if the economy slumps into a deeper recession. The great news is that there are ways for you to actually increase your income during your retirement years, without sacrificing the freedom and relaxation you have undoubtedly come to enjoy.
While itís true that corporations and small businesses are laying off employees and offering incentive programs to encourage early retirement, these same businesses still have needs that require professional expertise. Expertise that you could offer on a consulting basis, likely for a higher hourly rate than you made as an employee. Companies are willing to pay independent contractors higher rates, because itís still cheaper for them than to carry the costs of a benefits package for an employee. In addition, these independent consultants offer a depth of experience and expertise that companies find essential to remain competitive and solve business challenges .
As a professional with years of experience in a particular field under your belt, you would have a significant advantage over a younger professional trying to break into the consulting field, because you could leverage your years of hands-on experience in your field of expertise. If youíve worked in several industries, that broadens your potential client base, and you could find a niche by combining two fields into one specialty consulting area.
You may have several reservations. First, youíre retired! Who signed you up to keep working? By consulting, youíre really running your own business. You can choose how many clients you want to take on, what level of services you want to provide, and pretty much how and when you work. You could take on one small project at a time, and even offer your expertise over the phone and email, and still bill clients at an impressive hourly rate. You could choose to work for only five hours a week if you wanted to, barely making a dent in your newfound freedom, but adding to your stash of retirement cash.
Your second concern might be the overwhelming thought of setting up and running a business. It might seem like a project much too large and possibly too complex for your liking. Luckily, itís not necessary to go through all the steps of setting up a business, because there are organizations that act as an employer of record for independent consultants, making it possible to run your own business while under the umbrella of a corporation. These companies, such as MBO Partners, often also offer benefits that you might receive if you were still working for a corporation, such as access to group healthcare insurance, a supercharged 401(k) to shelter your new supplemental income from taxes, and expense reportingreimbursement. Thatís right, you could still take advantage of all the tax deductions business owners benefit from, without the complex tax management.
The less obvious benefit to consulting post-retirement is that, believe it or not, you might get bored. Keeping your mind fresh and staying engaged with what you love to do can help keep you healthy Ė not to mention wealthy and wise, for years to come. It is possible to enjoy the freedom and relaxation of your retirement years while still continuing to provide for your family without worry.
Angela Stringfellow is a marketing communications consultant and an MBO Partners associate. Visit their website, MBO Partners.
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