5 Unexpected Sources of Retirement Income | Smart Change: Personal Finances

(Selena Maranjian)

If you’re thinking about retirement and worried that your expected income won’t be enough, here’s some good news: There are many possible sources of retirement income, and some of them might surprise you.

Here are some ways to generate income in your later years. See which ones suit you best.

Image source: Getty Images.

1. Dividends

Dividend income is probably the least unexpected in this group, but the amount of income that dividend stocks can generate is often underestimated and potentially surprising. For example, if you retire with a stock portfolio worth $500,000 and it has a dividend yield of 3%, you’re looking at an annual income of around $15,000 – and that’s likely to increase over time, as dividends from healthy companies tend to increase every year or two.

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Here are some examples of reputable dividend payers – and their recent returns:


Recent dividend yield

















Coca Cola


Data source: Yahoo! Financial.

If you don’t already have one dividend-paying stocks in your portfolio, consider adding them.

2. Your home

Your home, perhaps unbeknownst to you, is a potential income generator — now and/or in retirement. On the one hand, you can rent a space – or rent the whole house – for short or long periods through services such as Airbnb. You can also host a boarder for a few years, if you and your household can afford it.

Then there is reverse mortgages, which are not suitable for all retirees, but which may serve some very well. They basically involve borrowing from a lender with your home as collateral. The lender can give you a lump sum or regular payments over time while you stay in the house. Once you don’t – because, for example, you moved into a nursing home or died – the lender claims the house, unless your heirs are willing and able to repay the loan.

3. Your car

Your car can also be a source of retirement income. Now, or in your early retirement years, you could earn money driving for a service such as Uber Where Lyft.

Another strategy is to remove a vehicle from your household fleet. If you have three, try living with two. If you have two, see if you can manage with just one. It can be quite easy for many couples to share a single vehicle once they are retired and not commuting to work. By getting rid of a vehicle, you can collect money in advance, then you will simply save money in the future, without having to pay for insurance, maintenance and repairs.

4. Your waste

Some of the money you’ll need in retirement is all around you, in the form of items you no longer need or want – and may never even have. used. Spend some time looking at things in your attic, basement, garage, and even your storage unit, if you have one. All of these unnecessary things could fetch big bucks at a yard sale — and some you might want to gift online. Particularly valuable items, such as certain collectibles, may be sold to dealers or others who appreciate their value.

5. Downsizing

Finally, an often overlooked way to generate more money for retirement while keeping more money in your pocket over time is downsizing. You can reduce the size in different ways. If you like your neighborhood or your city, you could sell your house and buy a smaller and/or less expensive one. If you’re not so attached to your current location, you can move to a less expensive city or state, or even a less expensive country. You may also be able to get closer to your family or loved ones this way.

By moving to a less expensive home, you can probably pocket some gains, and you’ll likely pay less on utilities, property taxes, insurance, landscaping, and maintenance (among other things) over time.

These are just a few ways to generate more money for your future, for a financially secure retirement. If some of them mean a lot to you, start looking to act on them.

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Selena Maranjian owns AbbVie and Enbridge. The Motley Fool owns and recommends Airbnb, Inc. and Enbridge. The Motley Fool recommends 3M, Uber Technologies and Unilever. The Motley Fool has a disclosure policy.