With the plunge of the global economy due to the COVID-19 pandemic, many people have had to either slow down, stop contributing to retirement funds entirely, or even tap into their retirement fund. With that, many individuals have had to find income alternatives to ensure that the funds that they have been sustained as well as ways to continue to grow their retirement funds.
While the pandemic has had a negative impact on the everyday operations of many small businesses, others have been able to adapt and thrive. Cleaning, delivery, landscaping, and especially companies that pivoted to making masks saw a significant rise in revenue. The needs of the consumer changed on a whim and companies that were able to make an appropriate change have stayed in business much longer.
Additionally, many individuals who were out of work after the pandemic initially hit have found this as an opportunity to pressure their own small businesses. Artists, writers, and digital creators have been able to increase freelance work or even start their own agencies by providing their services remotely. With everyday employment in doubt, many have found that they can still make a livable wage without full-time work.
With continued uncertainty in the economic landscape as well as the future of retirement funds, those who are nearing retirement have found reverses mortgages are a great way to put a large sum into their nest eggs. A reverse mortgage is different from a traditional mortgage in that the homeowner still owns the home, but they're borrowing money from a bank or broker based on their equity in the home.
Qualifications are reverse mortgages are specific in that only those who are 62 years old and have around 50 percent equity in their home are eligible. Further eligibility requires that applicants only take a reverse mortgage against a primary residence as well as attend an educational HUD-Approved counseling session. Learn more about reverse mortgage eligibility and interest rates by speaking with All Reverse Mortgage or competing lenders you can compare here.
Despite record unemployment and social distancing protocols, people continued to relocate during the pandemic. This continued to provide seniors with the option to sell their homes and downsize to save on a mortgage or put their equity toward savings. Seniors have found that this is another option for adding a lump sum of cash toward a retirement account.
As opposed to some who have reached retirement age and left the workforce during the pandemic, others have chosen to keep their income. Many essential employees like grocery store clerks and government workers have managed to keep their jobs and continue to bring in their regular income. Seniors who have decided to put off retirement have found a steady income by working as an essential employee where it's available.
With the financial world seemingly upside down, dividend stocks have provided those who want to supplement a retirement fund with a viable option. Even after the Game Stop spike a few months back, dividend stocks provide supplemental income at a quarterly or yearly rate. Most dividends aren't significant, but individuals who feel comfortable making a large investment are able to draw a sizable dividend check in return. Most dividend stocks are considered to be relatively safe investments as they are offered by large and well-established companies.
When all else has failed, some individuals have resorted to cashing out a life insurance policy. A whole life insurance plan allows policyholders to withdraw a portion of cash or take out the entirety of their plan. For those who have been paying into a whole life insurance plan for many years, this option has provided a good option for quick cash when it's needed.
By finding ways to supplement a potentially depleting retirement fund, many individuals have managed to find ways to continue to grow their savings despite the current economic state of the world. Because of unemployment, it has taken creativity and ingenuity to find new ways to bring in high enough levels of income to both meet basic income needs as well as put extra funds into a retirement savings account. Although, there are many
As the world slowly returns to a certain level of normalcy with COVID-19 vaccinations, retirement savings will, too. This means that 401(k) accounts and IRAs will also return to normal and the level of uncertainty will decrease. Retirement will once again begin to feel like a reality for many who were concerned that a global economic collapse would erase their retirement savings.